Ant talk

leaf

Cast your mind back to March of 2009. Stock markets just cratered by 55%. Global credit markets were seizing. New York investment banks Bear Stearns and Lehmans had evaporated. Giant companies were announcing massive job losses. GM and Chrysler teetered on the edge of bankruptcy. Talk of depression and sautéed squirrel was everywhere. And new home sales in Toronto crumbled.

Four years later, it’s happened again. No, not the succulent rodent main course or the stock shock – but the real estate thing. Builders in the GTA, the nation’s largest market by far, have announced the worst results since that dark time back in ’09. Considering we have rock-bottom mortgage rates and 48 months of recovery time, it’s a significant event. But it tells us much.

For the record, new home sales in March tumbled 47% from year-ago levels. Condos and SFHs were nailed equally. And for the first three full months of the year, sales are now down 34%, which includes a 43% drubbing for low-rise construction. This is not happy news among the cranes, as there are still 21,000 newly-built and empty (and unsold) condo units on the market, plus more than 60,000 in the pipeline, and 9,000 on the resale market.

Unless economics don’t matter anymore, this would suggest (a) many drywallers, plumbers, formers and electricians will be robustly unemployed in the months to come, (b) prices have only one direction in which to head and (c) we should have a moment of silence for all those who ignored this pathetic blog and bought within the past year. Hell, make that two years. Just like Wal-Mart, we’re rolling back prices!

I said this tells us much. Pour a scotch. I’ll explain.

It’s not different here. There, I said it. Years after watching Americans self-destruct because they wanted more than they could afford, and invented ways of getting it, we’ve done the same. Now that commodity prices have retreated, our exports dwindled and the economy started to atrophy, it’s clear there’s nothing special or unique about our economy, or our housing market. We allowed real estate to inflate because loans were cheap and house lust rampant. Properties didn’t rise in value because national wealth rose, or  better genes and pulchritude, but because we borrowed like crazed beavers.

Borrowing, as you know, means reaching into the future and dragging unearned wealth forward. When the future arrives (that would be now), you have to put it back. If your net worth has not bounced higher along the way, you’re toast.

Rob Palombi is a smart guy, not merely because he agrees with me (although that’s usually enough). As an analyst with Standard & Poor’s Canada, his job is to assess risk. Fixed income risk. Company risk. Country risk. His new report says Canada is about to take a back seat among western countries, thanks to two things: crappy commodity prices and wonked consumers. Of the two, household debt is probably the biggest threat, since it could take a decade to repair.

In fact, the household share of total spending in the country (the entire economy, including Mike Duffy’s expenses) now sits at 54%. So if real estate continues to wobble and family incomes stagnate – both highly likely – it could result in a ‘potentially large disruption.”

“Until Canadian consumers create a bit more headroom for themselves by getting control of their debt levels, consumer spending is unlikely to be a strong growth driver for the Canadian economy,” says Palombi. In contrast: “U.S. consumers have made more progress in reducing their financial leverage, so we expect to see stronger U.S. growth in 2013 and 2014 ending the five-year trend of outperformance for Canada’s economy.”

Exactly. This might help explain, at least a little, why the Dow is up this year 11.97% and the TSX has lost 1.9%. It also could be behind a 12% jump in US existing home prices in March, compared to last year, while we will soon see year/year declines. As I have been telling you for endless months, Canada is losing altitude and nearing a point of deflation, while the States reflates and rebounds. They’ve already taken the real estate hit and slogged through personal debt repayment. Meanwhile we’ve been borrowing and partying.

Ever hear of the grasshopper and the ant? You will.

It’s not 2009, and I still believe there’ll be no US-style, jingle-mail, change-the-locks, OMG housing crash in Canada. But real estate will cost less this summer than now, even less next summer and still less after that. The decline will not tank banks or bring on locusts. It will just slowly but steadily eat through the net worth of many people you know.

There’s still time to warn them. Let me know how that goes.

195 comments ↓

#1 Brad Lam on 04.22.13 at 8:55 pm

First?

Actually, yes. And ten more idiots were right behind you, all deleted. And this used to be such a nice blog. — Garth

#2 guelphstudent on 04.22.13 at 8:59 pm

Most of my friends who work at construction/renovations industries are lately playing world of Warcraft on the weekdays (9-5)

#3 Poorboy on 04.22.13 at 9:00 pm

I know quite a few people who are screwed. :-(

#4 rower on 04.22.13 at 9:01 pm

The warning hasn’t gone over well at all. No one wants to hear it.

They still think a small correction may be coming, but not to their area. Things are different there.

#5 Randy on 04.22.13 at 9:03 pm

My household is at -60%….What have I been missing ?

#6 Daisy Mae on 04.22.13 at 9:05 pm

Pour a scotch. I’ll explain.

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

Okay! Sounds good!

#7 Cthonic on 04.22.13 at 9:11 pm

Do you drink The Macallan, Garth?

#8 I'm stupid on 04.22.13 at 9:14 pm

Hi Garth

Nice post. What is your opinion on the US Stock market? Is it due for a correction?

#9 Craig on 04.22.13 at 9:18 pm

The world is so screwed up. The events in Boston and then Toronto / Montreal today and I get this email from CNN;

The U.S. government is delaying the implementation of a rule that would again permit passengers to carry small knives on commercial flights.

Remind me again of the weapon of choice for the 9/11 terrorists?

WOW they actually have to rethink it?

So yeah interest rates are at historic lows and sales plunge.

HUH

So what’s about the grasshopper and the ant?

#10 Frustrated on 04.22.13 at 9:22 pm

With all the warnings, I don’t understand how people are still buying at these prices. I sold my house a year ago and renting. I’m surprised the housing market is holding on for so long.

#11 David on 04.22.13 at 9:24 pm

People at work were discussing how Toronto is the 4th largest city in North America and all this growth will naturally keep home prices rising.

I asked how people will pay these higher home prices as salaries have not kept pace. I wonder if they just see me moving my mouth but can’t hear anything I’m saying.

Can’t save everyone, luckily I’m having better luck with the family.

#12 T.O. Bubble Boy on 04.22.13 at 9:24 pm

The Globe&Mail is reporting that CMHC CEO Karen Kinsey’s contract will be done on June 15th, and she won’t seek another term.

GOOD RIDDANCE!!!!!

Don’t let the elfin deity hit you on your way out.

Can you take F and Diane Finley with you?

#13 Piccaso on 04.22.13 at 9:24 pm

The flip is turning into flop. lol

#14 Short Vowels on 04.22.13 at 9:25 pm

The flyers in my beachy mailbox are starting to get more desperate. I have one here for Upperbeach villas advertising 0% 3-year mortgage, no bank approval, in size 72 Bold Verdana.

They’ll even give you free hotdogs with your free money if you go to their showroom this weekend.

I’m just going for the hotdogs.

#15 Mister Obvious on 04.22.13 at 9:26 pm

“Borrowing, as you know, means reaching into the future and dragging unearned wealth forward. When the future arrives (that would be now), you have to put it back.”
——————————–

That is poetry. Darn near makes me tear up.

#16 Dr. Oblivious C.F.O.S. on 04.22.13 at 9:26 pm

What brand of scotch? I usually drink Crown Royal.

I’ve passed your message on to the few people I’m concerned about, they all think they know better.

#17 Toronto_CA on 04.22.13 at 9:29 pm

Awesome post tonight Garth!

This part, however:
“Unless economics don’t matter anymore”
kind of worries me. I hope the taxpayer isn’t on the hook when things go sour for all these condo builders.

#18 RayofLight on 04.22.13 at 9:30 pm

There are wonderful stocks in the TSX that have strong upward trends. Eg ITP, WJA, MG . There are many more ,and more liquid, in the NYSE. These are far safer than a house right now. Rent and invest.

#19 Craig on 04.22.13 at 9:30 pm

#162 Craig . Turn your tee-vee off. They’re playing us with a bad ‘B’ movie plot. C’mon, two guys with pickaxes on a rail line could swiftly disable it sooner – with predictable results.
Yet we’re always sold stories of a ‘sophisticated terror network’ who is, seemingly, always foiled at the nick of time. This time, lined back to [guess who] country.

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

As in the 2 guys in Boston or the 6 guys on those 9/11 planes.

#20 Serge on 04.22.13 at 9:31 pm

Some good numbers:

http://vancouverpricedrop.wordpress.com/

#21 young & foolish on 04.22.13 at 9:32 pm

Inspired post!

We love this blog!

#22 Ant talk — Greater Fool – Authored by Garth Turner – The Troubled Future of Real Estate | The Affluent Boomer™ on 04.22.13 at 9:36 pm

[…] Cast your mind back to March of 2009. Stock markets just cratered by 55%. Global credit markets were seizing. New York investment bank Bear Stearns was evaporating. Giant companies were announcing massive job losses. GM and Chrysler teetered on the edge of bankruptcy. Talk of depression and sautéed squirrel was everywhere. And new home sales in Toronto crumbled. Continue reading → […]

#23 None on 04.22.13 at 9:37 pm

So would you recommend that a well diversified portfolio should be less exposed to the TSX? I’m currently at 30% – would you recommend lower?

Canada equals 3% of global markets. Why own ten times that amount? — Garth

#24 MarcFromOttawa on 04.22.13 at 9:37 pm

My condo isn’t selling.

I might take it off MLS soon.

#25 Baa Baa Black Sheep on 04.22.13 at 9:40 pm

Garth, my dear friend,
I have condos for sale all over TO. Great deals, you cannot pass up these limited time offers. Just for you Garth, 2 condos for the price of 1, no maintenance fees for an entire year, and also a $250 LCBO card I will throw in to drown your sorrows. I prefer the Irish whiskey myself. I could go for some Jameson right about now.

#26 None on 04.22.13 at 9:43 pm

“Canada equals 3% of global markets. Why own ten times that amount? — Garth

Because of favourable tax treatment in non-registered accounts… Does that justify it?

#27 East Van on 04.22.13 at 9:43 pm

Cool. 2 years of economic pain means I won’t have to look at Harper’s smug face again after 2015.

#28 Chickenlittle on 04.22.13 at 9:43 pm

http://ca.finance.yahoo.com/news/comes-next-hot-emerging-market-200700771.html

How long have you been saying this for?

I am not surprised that people don’t know whether to buy or not. I read the Star because it is free at Humber, and it gives me a good laugh.

Anyways, every day there is an article about housing. Every day it recommends something different. Buy now. No wait, housing just went up last week, so sell.

It makes me laugh, but I could see how frustrating it would be for someone who only picks up the paper once in a while.

Here are a few bon mots from the Star:

http://www.thestar.com/business/real_estate/2013/04/17/canadas_housing_market_drawing_the_bigmoney_crowd.html

According to the article above Canada’s housing is undervalued…

http://www.thestar.com/business/real_estate/2013/04/15/real_estate_home_purchases_down_15_per_cent_in_march.html

http://www.thestar.com/business/personal_finance/2013/04/20/firsttime_home_buyers_web_savvy_wary_of_the_banks.html

SIGH….

#29 Junkieman on 04.22.13 at 9:44 pm

#16 Dr. Oblivious C.F.O.S. says “What brand of scotch? I usually drink Crown Royal.”
This is funny on so many levels, scotch is from Scotland, Crown royal is rye, well it was rye, now its mostly corn based due to massive consumption.(corn is much cheaper then rye to produce in liquors)

But great post Garth

#30 A Yank in BC on 04.22.13 at 9:45 pm

One of Aesop’s Fables

The Ant & the Grasshopper

http://www.longlongtimeago.com/llta_fables_antgrasshopper.html

#31 JSS on 04.22.13 at 9:46 pm

What if you like the TSX?

#32 DDCorkum on 04.22.13 at 9:48 pm

#1

“First?” –Brad Lam

“… And ten more idiots were right behind you, all deleted….” — Garth

—–

If I asked you not to walk on my lawn, would you return the next day and do it again?

If I asked you to stop soliciting at my door, would you return 5 minutes later to sell me another product?

So why is it people keep saying “first” on this blog, when the blog’s owner clearly has asked them to stop?

#33 Chickenlittle on 04.22.13 at 9:48 pm

Anybody else HATE that Scotiabank commercial with the marching band that greets the woman who paid off her mortgage early?

I want to gouge out my eyes and rip out my hair every time that comes on.

PS: That Noam Chomsky quote that someone posted the other day was bang-on.

#34 Paully on 04.22.13 at 9:49 pm

#24 MarcFromOttawa

If your condo is not selling, reduce your price. It is simple economics. If you don’t do it, someone else will do it for you. Isn’t it better that you be in charge?

#35 len on 04.22.13 at 9:50 pm

Your assessment of the situation in the US is pretty cursory. Debt has not been repaid – repudiated would be a more accurate description. Bounce in housing in many areas represents a desperate chase for yield by hedge funds. In some areas, fully 70% of housing stock is being bought by large institutional money. I just returned from Phoenix and even the “peasants” are aware and laughing at the wishing rents. Hedge funds don’t strike me as particularly patient investors – they are flippers. Wonder who they flip to – probably slower and less smarter money – if they find them?

There is no bounce back – just forced, desperate liquidity to create “animal spirits”. Makes one wonder how many bubbles people will buy into before they learn. Maybe they have learned: get in early and hope to get out in time. A very unstable situation all around. But then that is why it is called financial repression – no good options and fewer every day for wealth preservation.

#36 TurnerNation on 04.22.13 at 9:54 pm

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Stephen who?

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Reserved:

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#37 John in Mtl on 04.22.13 at 9:55 pm

Lets see, “21,000 newly-built and empty (and unsold) condo units on the market, plus more than 60,000 in the pipeline, and 9,000 on the resale market.”

That equals 90,000 dwellings of all sorts. Assume 2.5 people per dwelling, that equals 225,000 people. Given our love for immigration, the fact that TO is the “buzyness” capital of Canada and the money flows like champagne, 90-thousand dwellings doesn’t sound like much to “liquidate” on the market. Methinks this is more and more just a big fuss over little.

John

#38 My thoughts on 04.22.13 at 9:58 pm

I was listening to a friend talking about how they bought a house. Now are getting divorced before the house closes… Yup you heard it right. Apparently a lot can change In a short time. Stuck. Not making enough money working 7 days a week. Planning on renting out rooms in the house. Can’t sell because the mortgage penalty is too high and they won’t be able to pay it! Why don’t people get advise before they Juno with both feet???? Bankruptcy awaits them!

#39 Paully on 04.22.13 at 9:59 pm

One of the Canadian versions of the classic Ant and the Grasshopper fable can be found here:

http://www.csd.uwo.ca/staff/magi/personal/humour/Fractured/aag.html

#40 W on 04.22.13 at 10:00 pm

Is it better to own a US etf that is hedged to the Canadian dollar or not hedged? I’m referring to it being held in an rsp. Ones denominated in US funds have much lower fees. Any suggestions appreciated.

#41 Daisy Mae on 04.22.13 at 10:00 pm

“Cast your mind back to March of 2009.”

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

Do we HAVE to….? LOL

#42 PermaBear on 04.22.13 at 10:01 pm

Crown Royal is not scotch, it is a canadian rye whisky of the highest quality.

#43 TurnerNation on 04.22.13 at 10:05 pm

I don’t think fables are any longer taught in school.
It’s all “Why do I have two Dads?” type of reading on offer. :-)
Shock and Awe with three, count ’em three types of useless hard math taught in high school. Then Bread & Circuses smart phones and video games. They have fight no longer. Perfect advertising targets.
The kids are all right?

#44 Timbo on 04.22.13 at 10:06 pm

#11 David

talking about it and being right will make you a hated know it all. ;)

http://www.cnbc.com/id/100662608

“Growth in China’s vast factory sector dipped in April as new export orders shrank, a preliminary survey of factory managers showed on Tuesday, suggesting the world’s second-largest still faces formidable global headwinds into the second quarter. ”

headwinds? How about blowback after eating at an all you can eat beans fest….

#45 Popeye the Sailor man on 04.22.13 at 10:06 pm

While at sea over the last three weeks, my wife just informed me the new friends we made across the street, have decided to buy a bigger house on a green belt for room and privacy.
They put an offer on the other house subject to selling there’s. Well it just sold so I guess they are moving.
I worry for them, even though he makes good money and she has a licensed day home for a few kids. A couple of years ago when there daughter was about 2 and before the day home thing they were worried about money and cut the cable TV. I know nothing much of how there finances are other than that.
But I think selling a 1800SF home for 400K and buying a larger one for just under 600K is a big stretch for any one. I hope them the best and will not rain on there parade, and I will pray there finances are in a stronger position than I believe them to be.
We owe 120K on a 460K house and have a family income of 100K and we find it hard for some of the extras we would like. This is the average family income in this small city in Alberta due to oil patch and duel income families and I don’t know how families pull off the 300K-500K mortgages and expect to be OK.

#46 Dr. Wayne on 04.22.13 at 10:08 pm

#1 Brad Lam on 04.22.13 at 8:55 pm

First?

Actually, yes. And ten more idiots were right behind you, all deleted. And this used to be such a nice blog. — Garth

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

So … it would appear you are starting to get pissed off with the cretins who post as such … good. I tried to do my part; I see now that when you are dealing with the ‘mentally defective’ types , I guess the most drastic action to curtain such behavior is …. “DELETED” … love to see that. Suck it up morons …

#47 visorman30 on 04.22.13 at 10:08 pm

Trying to convince people at work that it is not a good idea has definitely not been a very popular position given how many of them are very house horny. Most of my peers are late 20’s early 30’s and from my perspective it’s as if they are entitled to own since they are all CAs. As smart as they all are I always get the same answers to my questions:

– Did you try to compare with the cost of renting?
– Are there better places for your money?
– If the market is cyclical, shouldn’t all this uncorrected growth be the peak, why buy at the peak?
– What happened in 1 years time in Vancouver?

All these questions don’t seem to matter.

The worst part is, because I don’t share their enthusiasm in the housing market, they make me out to be the bad guy rooting against them. I can only try to tell them that I’m a friend and I don’t want anything bad to happen but that doesn’t mean I will agree with every decision they make.

#48 Tripp on 04.22.13 at 10:09 pm

To #10 Frustrated

“With all the warnings, I don’t understand how people are still buying at these prices.”

In my circle of colleagues and friends, I am amazed how few read the financial news. Even during the past months, when RE caught the attention of mainstream media, few are aware of the slowdown. And there is the “RE always goes up” category, still going strong…

#49 Smoking Man on 04.22.13 at 10:11 pm

I agree with Garth… Prices will be lower in Summer…

But then again I summer fall prices are always lower in the summer and fall…

Buy in Dec, Sell in march..

Btw hallelujah there is a house finally for sale in long branch, south of Lake shore walking distance to go….. A small semi. Not on mls yet,

Nows your chance kids….

#50 Daisy Mae on 04.22.13 at 10:13 pm

4 rower: “The warning hasn’t gone over well at all. No one wants to hear it.”

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

THAT is the major problem. People are in denial.

#51 Post Haste on 04.22.13 at 10:15 pm

Case in point, 1st brother-in-law is a licensed plumber, just bought a home in Georgetown and signed off to a $545K 2 storey home in the middle of nowhere. He tells us how in the past year the owner has got rid of 1/2 the guys – but he continues to think his $35hr job is good for life…I tell him to take caution, he thinks I am a fool – that housing will go on forever…he’s completely delusional – only a market fallout will wake him up!!

My 2nd brother-in-law is a even bigger boob, he quit his job that was secure – and now works as a sub-contractor painting homes – he mentioned 2 jobs in the past month – if his wife wasn’t putting in 55hrs per week – they’d be royally screwed..

Neighbour – now this is where I cheer for a housing correction – his is one of the biggest turd’s you’ll ever meet, he give’s most Italians a bad name – he works in construction and I pray every night that he loses his job – can’t afford his home or all the stupid toys he buys. Years ago he worked 6 days a week, and wasn’t home until 6pm each night – now he is lucky to do 5 days and is home after 4pm – I have my banner ready to say farewell A$$hole…

Those in the trades have better put some money away – as this is gonna be an ugly ride down –

#52 NotAGreaterFool on 04.22.13 at 10:16 pm

“Real estate will cost less this summer than now”? Does this mean a year over year price drop?

After Spring sales, I would expect a dip. Question is will that continue in Fall season or will there be normal bump again?

#53 TurnerNation on 04.22.13 at 10:18 pm

Craig: I guarantee you the attacks will cease once we are fully wrapped in an electronic control & tracking system. Papers, please. You shall know them by their actions. Don’t take my word for it. I am interested in profit – was searching for biometric and surveillance stocks tonight.
Beg our leaders for more laws and measures, and security apparatus. Do it now.

#54 AK on 04.22.13 at 10:19 pm

#31 Dr. Wayne on 04.22.13 at 10:08 pm
“So … it would appear you are starting to get pissed off with the cretins who post as such … good. I tried to do my part; I see now that when you are dealing with the ‘mentally defective’ types , I guess the most drastic action to curtain such behavior is …. “DELETED” … love to see that. Suck it up morons …”
——————————————————————–
I second that, Dr. Wayne.

Hear that “Humpty Dumpty”?

Passage: 167:345234 – Out.

#55 Dan on 04.22.13 at 10:20 pm

Garth, what happens to city property taxes when house prices fall? I’m in Qc. I saw that in the USA if the selling price went down, so did the taxes proportionatly, bringing some cities to bankcruptcy. What’s the rule in Canada?

#56 Patiently Waiting on 04.22.13 at 10:21 pm

The numbers don’t lie, and are backing up what Garth is saying. Here are combined stats from the Greater Vancouver Real Estate Board & the Fraser Valley Real Estate Board. They demonstrate that not only is Garth right, but the sales are decelerating at a faster pace in the last 30 days …

The following are sale of single family homes in Vancouver and the fraser valley since January 1 of this year and compared to previous years back to 2009.

Year Sales of SFH

2013 4420

2012 6855 (2013 sales are 35% lower than this)

2011 8769 (2013 sales are 50% lower than this)

2010 7417 (2013 sales are 40% lower than this)

2009 5027 (2013 sales are 12% lower than this)

—————————————————————

The following are sales of single family homes in Vancouver and the fraser valley for the last 30 days and compared to previous years back to 2009, and indicate sales are slowing at an increasing rate:

Year Sales of SFH

2013 871

2012 6855 (2013 sales are 58% lower than this)

2011 8769 (2013 sales are 67% lower than this)

2010 7417 (2013 sales are 64% lower than this)

2009 5027 (2013 sales are 58% lower than this)

Cheers
pw

#57 Freedom First on 04.22.13 at 10:21 pm

The Grasshopper and the Ant

The Grasshopper is house horny and puts all of his borrowed money and future income into 1 asset. His house. When winter/recession/problems come, he is homeless and bankrupt.

The Ant saves and invests for the future, remaining liquid, balanced and diversified. The Ant is always free of financial stress year round no matter what happens, because he understands what true wealth is, and knows that home is wherever he happens to live, no matter whose name is on the deed. The Ant is never controlled by house lust, so is always financially sane.

The story ends when the financially insane grasshopper comes to the financially sane Ant and begs for help. The end.

#58 West Vanner on 04.22.13 at 10:24 pm

So we should all plant our money in the wonderful investment world to see it go down 55% and then wait for better things to happen? Doesn’t sound like much of a plan to me. BTW some friends of ours are in the independent trucking business in the US, they have been ‘rolling’ for the last 4 years with paid freight. Nowadays they can’t get a load if they paid for it. Doesn’t sound good to me. We’ll see I guess, as everyone else is “guessing”

#59 T.O. bidding wars debunked - updated daily on 04.22.13 at 10:24 pm

I have finally reached my goal. I wanted a map to show the truth about the “bidding wars” going on in T.O as some newspapers or real estate agents pretend.

http://recharts.blogspot.ca/2013/04/to-bidding-wars-debunked.html

This maps shows you the type of house, the price paid, the percentage under or above the asking price paid by the buyer AND the average price at street level!

This way you can compare and see if in fact the house was initially listed under the average price of the area.
In such cases MLS reports 5-10% over the asking price but actually these days the seller get

#60 Cowpoke on 04.22.13 at 10:26 pm

Bankers knowingly lay the traps and they know most people will step into it. Governments do the same and so do corporations and institutions. Everybody is guilty. They get to keep their jobs and the rest of us are well,… collateral damage.

#61 Ronaldo on 04.22.13 at 10:26 pm

It’s not just those who have purchased in the last couple years that are screwed. It’s all of those that have bought since the BOC rate dropped from 4.5 to .25 starting at the beginning of 2009.

Many of these people have heloc’d themselves to the teeth to purchase toys and stuff to fill the houses they purchased with illusionary equity which will disappear in the next few months.

Prices will not have to drop very much to create havoc amongst this group since they have already spent that phony equity.

I would think the banks should be somewhat concerned regarding those loans that are not insured.

This is the same thing that happened in the U.S. The ones that had no skin in the game walked away with their toys leaving a vacant and sometimes thrashed house. No loss to them. They came in with nothing to begin with. It’s the ones who put their entire savings into buying these overpriced houses who got seriously burnt.

#62 Ronaldo on 04.22.13 at 10:33 pm

#48 Tripp –

“With all the warnings, I don’t understand how people are still buying at these prices.”

Too busy tweeting and texting to know what is going on around them. A society of clueless individuals. No wonder they are so easily conned.

#63 Humpty Dumpty on 04.22.13 at 10:34 pm

190 CrowdedElevatorfartz on 04.22.13 at 7:55 pm

Imagine if you had put all that brain power into something useful…

How insightful from a guy whom savours his own smell in a confined area…

Watch this Doc… Its right down your league…

http://video.tvguide.com/Vanguard/World's+Toilet+Crisis/5411997

Its a global public health crisis… No pun intented..

#64 raisemyrent on 04.22.13 at 10:38 pm

I am pushing 30 and thus I have many house-horny friends. Everyone of them has to “own” a house. That is the goal in life; that is how you provide for your family. It almost reminds me of a movie about settlers in the american west, you know, who’d claim some land, build a house with their own hands (falling the trees themselves, etc.), provide for their family, raise their children, etc.

Key word is “owning”; you don’t own jack. You OWE a lot, that is.
I find it interesting, to say the least, how people always shy away from buying expensive cars on financing. A waste of money, too much interest, it always depreciates, etc. Yet, talk to them about signing a loan for usually (and at least) 10 times as much, with a variable rate or with one locked for 5 years (but amortised over 25 or so), on something whose value you cannot predict, and they will defend it to death. At least with a car, you know it depreciates, you know the costs, you accept it, you want it, you can afford it, you take the dip, and you’re done. But don’t judge from your borrowed stick-frame fort.

I’ve tried to warn many a a mortgage-horny friend, mostly, to no avail. People don’t want to listen. I get HGTV quotes back, posing as counter-arguments. People get emotional! Imagine a friend of yours getting emotional after you disagree with a certain stock he/she recommends you buy. Doesn’t make sense, does it?
The key to success is to jam up your RRSPs and get a mortgage as soon as you get pre-approved.
OK. Go ahead and succeed.
I’ll be over here, failing…

#65 Uwinsome on 04.22.13 at 10:39 pm

“For the record, new home sales in March tumbled 47% from year-ago levels. Condos and SFHs were nailed equally.” – Garth

I’m not calling you a liar, but I haven’t read or can’t find any reports that state these numbers.

Could you point out your sources?

RealNet. Link published earlier today on this blog. Try to keep up, and I won’t call you lazy. — Garth

#66 Dr. Hoof-Hearted on 04.22.13 at 10:40 pm

#51 Post Haste on 04.22.13 at 10:15 pm

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

Re Trades = ” Pendulum Swing ” ?

I have this feeling that a lot of this Gov’t hype to get people into ” trades” is simply the pendulum swing after the promotion of University Degrees pump and dump fizzled insofar as jobs.

“Get a trade” mantra will now change the herd direction and keep the eye off the ball.

More debt and false hope.

#67 syfon on 04.22.13 at 10:41 pm

First at 10.30pm

#68 Smoking Man on 04.22.13 at 10:42 pm

Boston

http://imgur.com/a/Nx8EU

This Link has gone viral on face book and twitter, been trying to debunk it’s content. For good reason. Because if the masses think the machine will roll over and play dead if it truly has provable blood on its  hands are sadly mistaken. Never in the history of humanity has the machine of the day  gone quietly into the night….

If it  gets caught with its paints down, sears catalog in the other, it will leave no witness… It will be brutal…

Help me get arguments to debunk this, I want a peaceful retirement…..

The machines delema, cops, spy’s, insiders, who knows what goods they have on their bosses, forced to toe the pa rty line, one click away from viral…

The herd, incomes dropping, loyalty not solid, should be interesting if the wrong slave, be it cop, spy, insider gets wronged….

#69 Canadian Watchdog on 04.22.13 at 10:48 pm

Video obtained by Global News reveals Calgary developer’s plan to control city council

What else is there to say?

#70 Smoking Man on 04.22.13 at 10:50 pm

Mooc, teachers your toast….

#71 Humpty Dumpty on 04.22.13 at 10:58 pm

194 espressobob on 04.22.13 at 8:05 pm

Why not educate yourself on economics & investing?

Ummm…. Why do you think I refer to G, as Rabbi.

A student is not greater than his master…

This is what happens when people don’t listen to The Rabbi….

http://www.scmp.com/news/world/article/1218517/murder-suicide-disease-surges-under-greek-austerity

#72 CrowdedElevatorfartz on 04.22.13 at 11:01 pm

@#33 ChickenLittle
Chickens have hair?

either way, total agreement.

#73 45north on 04.22.13 at 11:04 pm

Post Haste: Neighbour – he gives Italians a bad name – he works in construction and I pray every night that he loses his job – I have my banner ready to say farewell asshole

He takes a stray dog by the ears, who meddles in someone else’s quarrel.

http://www.catholic.org/bible/book.php?id=24&bible_chapter=26

Patiently Waiting:The following are sales of single family homes in Vancouver and the fraser valley for the last 30 days and compared to previous years back to 2009, and indicate sales are slowing at an increasing rate:

that got my attention! Best Place on Earth posts no more – no more boasts. Devil’s Advocate doesn’t post either. He knows that the market is toast. He totally knows.

#74 timmy on 04.22.13 at 11:07 pm

Many people in Vancouver already own their homes and or they’re up 100 percent, so even if it falls 20% they wouldn’t bother moving–they would still be ahead of the game. THis is one reason why prices aren’t falling significantly in Vancouver, despite the economy and all of the gloom and doom

#75 not 1st on 04.22.13 at 11:11 pm

Garth, don’t pretend that the americans are some sort of model prudent consumer that knew exactly when to reduce their spending. Its nothing of the sort. They stopped spending because they were foreclosed on, lost jobs, were outsourced and offshored, declared bankruptcy, bailed out wall street, went on food stamps etc etc.

And while the consumer may have been forced to reign in spending, the bloated govt sure didn’t. Deficit doubled, fed balance sheet went up 10 times, treasury same thing, and a couple trill in wars on the credit card yet all while Medicare and SS are insolvent and unfunded liabilities stand come where between 75-200 trillion depending on how its counted.

#76 CrowdedElevatorfartz on 04.22.13 at 11:13 pm

@#42 Permabear
“Crown Royal is not scotch, it is a canadian rye whisky of the highest quality”
BWAHAHAHAHAHA OMG! BWAHAHAhahahaHAHAHAHA
ohohohohohohohohho, hah, hee hee ho ha , aaaaaha. ha ha ha. ohhohohho, uh huh, uh snif, snort, chuckle.

Sorry.

“highest quality” just hit me as slightly amusing.

Pardon me while I pour myself a 25 year old Highland Park……

#77 Canadian Watchdog on 04.22.13 at 11:19 pm

RealNet. Link published earlier today on this blog. Try to keep up, and I won’t call you lazy. — Garth

See what happens Garth when Tara Perkins and Susan Pigg don't report the news? They totally swept this one under the rug today. Not one peep, as told. 

#78 will on 04.22.13 at 11:22 pm

pulchritude. had to get out the OED for that. Means beauty. from the latin pulchritudo Thanks for the language challenge Garth.
-w

#79 Dorf on 04.22.13 at 11:22 pm

“There’s still time to warn them. Let me know how that goes.”

A friend of mine wants desperately to buy a house and is working hard on repairing her credit so she can qualify for a mortgage.

I said, “Take five years at least to save your money and watch the market, then you will be in a better financial position and the prices will have declined”.

She said, “There’s no way I’m waiting five years ! Two years max ! I don’t want to be paying a mortgage at 80 years old !”

That’s how it is going…..

#80 CrowdedElevatorfartz on 04.22.13 at 11:24 pm

@#63 humpty dumpty
Well if you want to compare Nom de Plumes.
I actually like yours. It has “Hump” and “Dump” all in the same name.
Kinda fecally creepy in a sordid sorta way……..

over to vous

#81 Monster Zero on 04.22.13 at 11:27 pm

Off topic, but we had 2 separate realtors aka used house salespeople literally walk up and knock on our door over the weekend, wondering if we had any plans to sell our place here in West Vancouver.
I guess biz is slow…

#82 poor me on 04.22.13 at 11:32 pm

Hey Garth,

just a thought, i heard you are renting….
do you have a sublet basement.
I started reading your blog 2nd day you launched it, so pretty much every day for last 5 years.
The way things are going it pretty much looks like, you and I will be the only ones renting at the end of this, if this happens would you sublet your basement to me and my family.

i cant even take the smugness on the faces of all people i know…

#83 CrowdedElevatorfartz on 04.22.13 at 11:34 pm

Damn the 25 year old Highland park was tasty!
Time for a shot of 25 year old Bruichladdich to cleanse the palate.
And if I get bored there’s always the 15 year old MaCallan to liven things up……..
All single malts poured over a sliver of ice, for you uneducated heathens out there that prefer ( UGH ) BLENDED Scotch or (gag) whiskey…….

cue outraged Permabear Crown and Coke swillers out there.

#84 Timbo on 04.22.13 at 11:39 pm

#69 Canadian Watchdog

nice find…..totally off my radar. What a video with more to come out tomorrow. imagine the damage this is going to do to reputations…..

#85 Happy times on 04.22.13 at 11:45 pm

Irish pension accounts just got bailed-in, the Cyprus way.

But just keep on plunging your hard earned tokens into the hypothecated global derivatives dominated high frequency manipulated synthetic digital system.

Source? — Garth

#86 Ydnew on 04.22.13 at 11:48 pm

The local Re/Max newsletter tells us that prices in Markham/Stouffville have dropped 2.8% in the past six months, though prices are still rising in Unionville (up 5.8
% in the same period).
The newsletter also cautions would be flippers that selling brand new houses on completion will result in CRA clawing back any GST rebate.
Times, they are a changing.

#87 Humpty Dumpty on 04.23.13 at 12:00 am

#196 Ralph Cramdown on 04.22.13 at 8:21 pm

1 Corinthians 3: 18 – 19

http://www.wkyt.com/wymt/home/headlines/Breathitt-schools-ordered-to-remove-Ten-Commandment-displays-202610071.html

#88 Dr. Hoof - Hearted on 04.23.13 at 12:01 am

#46 Dr. Wayne on 04.22.13 at 10:08 pm

So … it would appear you are starting to get pissed off with the cretins who post as such … good. I tried to do my part; I see now that when you are dealing with the ‘mentally defective’ types , I guess the most drastic action to curtain such behavior is …. “DELETED” … love to see that. Suck it up morons …

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

Good thing Dr Wanker won 6/49 after graduating “bottom”(aka top a$$hole) of his proctology class.

Otherwise…who would go to his clinic if all he did was call them a$$holes?

#89 NoOneOfConsequence on 04.23.13 at 12:18 am

Johnny Walker Gold. Smooth as silk with an amazing aroma…and a nice slow burn in the belly.
Oh yeah…..

uh oh…is this gold pumping?

#90 This Is My Story on 04.23.13 at 12:20 am

Pendleton Whiskey. Made in Canada blended in Oregon.
Haven’t been able to find it in Canada but am more than willing to pay the duty to bring it back to where it is made. Pity.

Haven’t yet bought a house but enjoying the show that is unfolding.

Thanks Garth for all your hard work and I feel sorry for the shit you have to put up with sometimes.

#91 dadeedum on 04.23.13 at 12:20 am

#74 timmy
“Many people in Vancouver already own their homes and or they’re up 100 percent, so even if it falls 20% they wouldn’t bother moving–they would still be ahead of the game. ”

That sentence sounds like a real estate agent who hasn’t slept in days- pure nonsense. Do you think people “bother moving” BECAUSE their house falls 20 percent? Timmy, if you have to sell your house (Because of divorce, loss of job, etc.) you have to sell. There are always people who have to sell- at whatever price the market will pay. They will set the new lower price for houses.
And BTW, prices in some areas of Vancouver have already fallen significantly – have you checked out Richmond’s latest sales prices?

#92 Tom from Mississauga on 04.23.13 at 12:26 am

http://www.realnet.ca/march-q1-2013-gta-new-homes/

Yah, those sales do stink!

#93 Oceanside on 04.23.13 at 12:31 am

6 Dr. Oblivious C.F.O.S. on 04.22.13 at 9:26 pm
What brand of scotch? I usually drink Crown Royal.
******************************************

???????????????????? Wrong whisky.

#94 Tom from Mississauga on 04.23.13 at 12:41 am

Oh, and all those sales still need to qualify for a mortgage…

#95 Tom Vu on 04.23.13 at 12:47 am

Got urgent e-mail from Prince of Darkness.

If Maple Leafs go past 2nd round…may not be able to afford heating bill…so far it is N/C.

#96 Jonathan on 04.23.13 at 12:47 am

Larry Summers said most eloquently:

“Things take longer to take than you thought they would, and then they happen faster than you thought they would.”

To me, the above captures the demographic & real estate shift in Canada over the coming decade. Live humble mes amis.

– Jonathan, Canadian in Houston, TX

#97 Joe on 04.23.13 at 1:13 am

“Warn” other people?! You must be joking, Gath. After moving to Canada from the only stable economy in Europe a few years ago in my late twenties, from a country where the majority of people rent, I constantly had to justify my decision to rent a nice condo from the first day on the new job here. It was literally at least once a week that a co-worker would start questioning me, why I was so stupid to throw money away on rent. Of course they had all bought a condo or house in the burbs and would casually mention every now and then how they were doubling down on their mortgage. Essentially text-book lemming stupidity.

Back then I didn’t have the right counter-arguments (other than a gut feeling that taking on insane amounts of debt was suicide) that I now know thanks to your blog, but rest assured, even if I had told them everything from your blog, they still would have kept going with real estate. This is so deep engrained into people in this country that nothing will change that other than year long financial hardship and bankruptcies by the thousands.

It’s way too late for a warning.

#98 Thaya Nadarajah on 04.23.13 at 1:30 am

Hi Garth,
Enjoy reading your blog. Yesterday I dropped my-self in to this open house in Scarborough (Kennedy and Finch area) and shocked to know that the asking price for a bungalow house for 600,000. The house needs big improvements and nothing was done in that property at all. Do you think anything changed at all in GTA real estate. Any big collapse this summer?
Thanks,
Thaya

#99 Fed-up on 04.23.13 at 2:00 am

#37 John in Mtl

_________________________________________________________

Yes, yes, just-off-the-boat immigrants will save us all. You make it sound like immigration to Canada en masse just started in the last 5 years. Give it a rest man…it’s over for real estate in Canada, at least for the foreseeable future. Real estate and every other market, has NEVER gone up sharply without a signficant future correction, EVER. And history ALWAYS repeats itself, often in an uglier manner than it did before especially when the correction is long overdue.

#100 Rob aka Captain and Mrs Slow on 04.23.13 at 2:05 am

@ none

done properly you don’t have withholding tax on US dividend stocks or ETFs

http://www.dividendninja.com/international-non-us-dividend-stocks/

#101 Buy? Curious? on 04.23.13 at 2:41 am

Garth, I’m confused and not like the good kind when the host of the party asks everyone to put their car keys into a bowl (er, um, it’s a Drink Driving thing. Yeah, that’s it!) You’ve said many times before that there won’t be a crash but a correction followed by a slow melt, though certain areas will retain their value. Then today you said,

“It’s not 2009, and I still believe there’ll be no US-style, jingle-mail, change-the-locks, OMG housing crash in Canada. But real estate will cost less this summer than now, even less next summer and still less after that. The decline will not tank banks or bring on locusts. It will just slowly but steadily eat through the net worth of many people you know.”

My confusion is this, where the urgency? Why should old people start selling their houses or hipsters rent places so long that their style COMES back in fashion?

I know it’s tough making predictions, communicating ideas but look at the great and powerful Robbie Ford. That guy takes the time out to explain how politics works to women.

http://www.thestar.com/news/city_hall/2013/04/22/mayor_rob_fords_offer_to_explain_politics_to_women_unlikely_to_win_him_female_voters.html

That guy knows how to talk to people!

http://www.youtube.com/watch?v=z8EpSdyB0zY

Rob Ford would kick Kim Jung Un’s ass!

#102 Piccaso on 04.23.13 at 2:47 am

Don’t get to comfortable in the U.S. stock market, it’s been on quite a run.

#103 SCIBIDUBADEBUMBADO on 04.23.13 at 2:51 am

Marc Carney is leaving us just as his little fiefdom of low interest rates are coming back to bite us. I wonder if the Brits will think any of the implosion about to occur here had anything to do with him.
He must be partly responsible for this debt mountain we have along with F.

#104 angel on 04.23.13 at 3:00 am

When Obama entered office in January 2009 there were 31,939,110 Americans receiving food stamps. As of November 2012—the most recent data available—there were 47,692,896 Americans enrolled, an increase of 49.3 percent.
Definitely a good time to invest in the food business in the USA screw them people all I care about is my S&P 500 stocks

#105 Piccaso on 04.23.13 at 3:20 am

Check this out… lol

Douglas Porter, Chief Economist, BMO Capital Markets

http://ow.ly/i/1WQtb/original

#106 Waterloo Resident on 04.23.13 at 4:05 am

The real reason for renting is EMPLOYABILITY !

If you get let go in one job, and you need to move to Ottawa to accept a new position, then you need the flexibility to move fast and accept that new job YESTERDAY !

If you are stuck because you have a house you cannot sell, well, then you will stay unemployed !

#107 Notta Sheeple on 04.23.13 at 5:41 am

“……new report says Canada is about to take a back seat among western countries, thanks to two things: crappy commodity prices and wonked consumers……”
=====================

How’s that (in-)Action Plan working out for you, Mr. Flaherty?

You know, the one where you offer crack cocaine of easy mortgages, driving up the purchase price of a Canadian’s largest expense, resulting in the outsourcing of thousands of middle class jobs offshore to countries whose citizens don’t require above-market wages to pay for half-million-dollar bungalows, leaving the remainder of Canadians as hewers of wood, drawers of oil, and refiners of rock, all in a dwindling commodity market.

Yeah, that Plan.

Not so good, huh…

#108 bigrider on 04.23.13 at 7:00 am

I have never understood this ,but if condos are such a great long term investment when you buy and rent them out, as the likes of Brad Lamb will tell you, why don’t they just keep the entire buildings themselves, along with all the units ,and rent them out themselves?

Afterall, if a building has 200 units or so, at 15k down on each it’s only 3million dollars to aquire them all which he certainly has.

Buy them all yourself Brad and rent them all out.

#109 Dave on 04.23.13 at 7:01 am

With your dire predictions listed above – how could you possibly expect a doubling of interest rates?

Reading this blog is making me dumber…

Dumb is looking at current conditions and expecting them to last forever. This recency effect blinds many investors. — Garth

#110 Tony on 04.23.13 at 7:22 am

The bond market in America is usually always right. It’s spelling recession or worst. Like i said before America at some point in time has to quit with all the lies and tell the truth.

The bond market is essentially unchanged for three years. It spells ‘nothing of the sort. — Garth

#111 Timbo on 04.23.13 at 7:26 am

http://www.telegraph.co.uk/finance/financialcrisis/10012203/Surprise-contraction-in-Germany-manufacturing-services.html

“Germany’s private sector shrank for the first time in six months in April, with a surprise contraction in both manufacturing and services in Europe’s biggest economy. ”

this contraction is going to give birth to something and it won’t be a baby……….

http://www.bloomberg.com/news/2012-08-21/greek-government-readies-cuts-to-pensions-wages-ta-nea-says.html

“The package, which includes cuts of between 2 percent and 20 percent to pensions and as much as a 35 percent reduction in pay for employees in state-run companies, will be finalised in talks with the country’s creditors by Sept. 14,”

recovery is but a myth……..

#112 T.O. Bubble Boy on 04.23.13 at 7:44 am

@ #31 JSS on 04.22.13 at 9:46 pm
What if you like the TSX?
————-

Acuras are pretty reliable cars, but I think you’re talking about the stock index?

Headwinds for most major components of the TSX: oil prices are down, banks can’t rely on the debt-addicted Canadian household for growth, materials need China to keep spending 60% of GDP on infrastructure (aka. Ghost Towns).

#113 Eric on 04.23.13 at 7:50 am

I meant “Should I convert all my money from CAD to USD now?”

#114 Buy? Curious? on 04.23.13 at 7:51 am

Hey Garth! I was just watching Bloomberg and the slick bastard was saying that Housing, Housing Developers and those that benefit ie. Home Depot would go up over the next few months. Check the site to get the exact wording. Then I flip over CNBC Squakbox and this woman (no disrespect ladies) among a table of pundits talking about housing says that the Market is strong but it’s taking a break. I love it! Propaganda at it’s finest! Who watches these shows and why do guys on those only have three types of hairstyles, bald, slicked back Gorden Geeko (misspelled on purpose) or that hairsprayed helmet parted on the right?

#115 Craig on 04.23.13 at 8:09 am

I’m NW of Toronto and houses are selling around the ask or above it. 98% to 105%

This is a fact as I know every house that’s for sale and the ask. I am watching closely and I see no sign of a drop or panic. Not even close.

The listings are lasting days, not weeks and that’s also a fact.

RE Agents are making 4.5% to 5% on $550K to $650K homes in 3 days.

Forget the trades! Be a REA.

It really bothers me to consider handing over $30,000 to a REA for 3 – 7 days work.

Is it just me or is everything totally out of whack?

Time to sell I think

The data does not support your comment. — Garth

#116 Victor V on 04.23.13 at 8:20 am

Canadians still pay 62% more for a home than in U.S.

http://www.theglobeandmail.com/report-on-business/top-business-stories/canadians-still-pay-62-more-for-a-home-than-in-us/article11493708/

#117 Craig on 04.23.13 at 8:24 am

The data does not support your comment. — Garth

We invited a REA to our home last night for a “free assessment” and he brought comparative solds and comparative availables in our area.

The solds were all at or above the list and the number of days listed was 3, 5, 7 not 100, 120, etc.

All of that data, was from print outs from the Realtor / MLS site.

I know it’s factual because I see the for sale signs go up, I then check MLS for the price and to look at the pics and then it’s sold in a few days.

All I know is that’s what’s happening here.

An agent bringing you selected comparables making you greedy and hot to sell. Who would have thought?– Garth

#118 Andrew on 04.23.13 at 8:39 am

House acrosss the street from where I’am renting in north york, went up for sale on friday, open house sat and sunday.. cars coming and going all weekend including yesterday , asking 640K for a 3bdroom 1400sq feet bungalow nothing special about the place. I suspect to see a sold sign next couple of days … yet you say we can expect lower prices by summer Garth.

For a change in trend we need a catalyst to get it going.

All the changes ottawa has done to supress buying , didn’t work. question is what will it be .. I think the Americans got it right take the hit right away and rebuild , now there in better shape for it..

without a crash mindset will not change ,mistakes will continue to be made sheep will continue to be slaughtered and in the end we all lose ..

#119 Angie on 04.23.13 at 9:01 am

Thanks Garth, I find your blog both interesting and entertaining.

Two years ago, when we sold our big (to us) house and downsized into a smaller home that we could pay off before mortgage rates go up, all my friends thought I was nuts.

I still watch them trading up to bigger houses – honestly who needs 3000 sqft for a family of 4? Their logic is that when they retire, their house will be worth double. I ask them if they ever heard of the Rule of 72? When they say no, I tell them to look it up and tell me if they are getting a good rate of return on their house.

I know you say you should rent, but we want to own a home, so I figure we best make it one that we can actually afford, while at the same time socking away %15 of our gross income for retirement. (I have taken your advice about ETFs etc, but I think I need to revisit how much I have in CDN)

#120 tim flinthead on 04.23.13 at 9:15 am

Bank of Canada repeats language on higher interest rates

http://ca.finance.yahoo.com/news/bank-canada-repeats-language-higher-interest-rates-130421203–business.html

#121 Ernst on 04.23.13 at 9:19 am

re #109 Humpty Dumpty yesterday – thanks for zinging the troll AK/Wayne yesterday. Sweet justice.

#122 amazona girl on 04.23.13 at 9:21 am

Hi GARTH , love the blog the older it gets,the better it
became.Like a scoth or a fine wine.
Mike Duffy expenses sits a 54 % Wow! I remember
him back on the 80 whem I work in Ottawa, I serve
him a couple of drinks .He use to tip well

#123 Toronto_CA on 04.23.13 at 9:29 am

Am I the only one reading articles like this (link below) and wondering how long the unemployed, disenfranchised youth in southern Europe is going to remain docile?:

http://business.financialpost.com/2013/04/11/life-is-bad-recession-weary-portugal-tests-limits-of-austerity/

History shows conditions this bad sometimes lead to anarchy or rebellion, if those conditions go on long enough. As bad as some of us think things are in Canada and the USA, they aren’t really compared to a huge swath of Europe. Scary, powerful stuff.

#124 The real Kip on 04.23.13 at 9:42 am

“Unless economics don’t matter anymore, this would suggest (a) many drywallers, plumbers, formers and electricians will be robustly unemployed in the months to come”

They’ll be unemployed in GTA in a matter of weeks, there is trouble brewing on the labour front in the form of a strike that will flatline condo construction and only condo construction in GTA.

Developers don’t have to give back deposits over labour disputes and count each day lost as three in terms of delivery.

The agreement is between the Ontario Formwork Association and the building trades and it’s in trouble.

#125 TS on 04.23.13 at 9:51 am

“As I have been telling you for endless months, Canada is losing altitude and nearing a point of deflation,…”

If so, will rate still be rised?!

Just not so simple, isn’t it?

It is simple. Things change, and the economy will improve. As it does, rates rise. Thinking oterwise is fanciful denial. — Garth

#126 John Prine on 04.23.13 at 10:00 am

It really bothers me to consider handing over $30,000 to a REA for 3 – 7 days work.

Is it just me or is everything totally out of whack?
*********************************************

Totally out of whack, in most places in Canada it’s hard finding a decent listing these days, mid Vancouver Island the average days on market is 303 and the average sale price is around $330,000 so a lot of work for not a lot of commission..

Some insecure people here talking about how much expensive single malt they drink………………

#127 Timbo on 04.23.13 at 10:02 am

http://timiacono.com/index.php/2013/04/23/slowing-growth-around-the-world/

“You’d think that economists would be catching on by now since, for example, they continue to forecast 3-4 percent growth in the U.S. a couple years out, but, it just never comes. Now four years after the 2008 recession ended, it looks like the U.S will see economic growth of less than two percent which, when factoring in population growth, is barely an expansion.”

must always forecast happy thoughts………..

http://bonddad.blogspot.ca/2013/04/country-analysis-china.html

“It also means that a strong bid for most commodities is gone. While commodity prices will not be crashing anytime soon, nor will they be bid as strongly as before.”

commodities are going to the moon, Harper told me!…..

#128 JO on 04.23.13 at 10:10 am

Irish pensioners lost 100 % of RSP type accounts.
ECB forcing gov’t to shut up or lose relations.
JO

————————————————————–
http://www.boombustblog.com/blog/item/9067-as-forewarned-the-irish-savers-have-been-cyprusd-and-theres-much-more-cyprusing-to-come

#129 AndrewAB on 04.23.13 at 10:12 am

Nice little attack campaign from our old friend Bob Truman:

http://bobsrealestateblog.com/

Why the obsession with Garth?
Garth envy of course.

#130 Paul W on 04.23.13 at 10:23 am

I also agree with Dr. Wayne, don’t hesitate hitting the delete button

#131 angel on 04.23.13 at 10:28 am

The bond market is essentially unchanged for three years. It spells ‘nothing of the sort. — Garth

actually it is its not so much that the numbers havent changed its whos buying it thats changed and it aint the chinese its the american tax payer, them suckers

#132 From Regina FML on 04.23.13 at 10:35 am

Latest Weekly Firm Sales MLS Data for Regina, YOY growth (loss):
1/19/2013 – (15.1%)
1/26/2013 – (9.1%)
2/2/2013 – (14.1%)
2/9/2013 – (21.1%)
2/16/2013 – (32.9%)
2/23/2013 – (48.7%)
3/2/2013 – 1.4%
3/9/2013 – (4.8%)
3/16/2013 – (14%)
3/23/2013 – (37%)
3/30/2013 – (20.5%)
4/6/2013 – (14.8%)
4/13/2013 – (39.2%)

However, at the beginning of the report they say this:
“Most of what is said in the national media has little to do with Regina real estate. It has a lot to do with overheated coastal markets that were overbought by overseas investors armed with cash or cheap financing. Because we’re faring much better locally, it’s sometimes beneficial to tune out the national news. For the time being, the local trend is expected to continue.”

Source: http://www.reginarealtors.com/images/trendline/weekly_activity_reports/2013/regina-wma-2013-04-22.pdf

Not exactly sure what numbers they are referring to, as “faring much better.”

No, we are not different here, other than we have decided that everyone should move to a place with 10 months of winter.

#133 Buyer on 04.23.13 at 10:47 am

“we should have a moment of silence for all those who ignored this pathetic blog and bought within the past year.”

Oh well, I haven’t listened. Got a nice cottage up in the mountains last spring for 160 000$ + purchased a 6-plex in december: invested only 60,000$ of our own money to get the 6-plex (priced at 355 000$), it gives us a positive cash-flow of a bit more than 1000$ per month. Don’t plan to resale it before a couple decades.

#134 lucyj on 04.23.13 at 10:53 am

Paragraph five, second sentence….best advice ever. To bad people have to spoil good whisky with ice. Great writing, keep up the good work.

#135 Dwilly on 04.23.13 at 10:54 am

Hey Garth, maybe in a future post, you could let us know what, in your humble (but always correct) opinion, this slowing Canadian economy portends for the Canadian Dollar?

#136 Victor V on 04.23.13 at 10:59 am

Bank of Canada repeats language on higher interest rates

Reuters – 1 hour 44 minutes ago

http://ca.finance.yahoo.com/news/bank-canada-repeats-language-higher-interest-rates-130421203–business.html

OTTAWA (Reuters) – Outgoing Bank of Canada Governor Mark Carney on Tuesday repeated the central bank’s warning that it expects its next move to be an interest rate increase, even after recently cutting growth forecasts.

“The considerable monetary policy stimulus currently in place will likely remain appropriate for a period of time, after which some modest withdrawal will likely be required, consistent with achieving the 2 per cent inflation target,” he told a Canadian parliamentary committee.

#137 Craig on 04.23.13 at 11:37 am

An agent bringing you selected comparables making you greedy and hot to sell. Who would have thought?– Garth

LOL

At the end of the meeting I said to him, $30K is a lot of money if these houses are selling in days. He said, do you know how hard I work to do all the advertising, virtual video, etc., etc., etc.?

I just said it does take time and left it at that.

I’m guessing most of that info is sent to other companies (contractors) they use so I would guess the TOTAL amount of time to get everything advertised, virtual video and Listed….maybe 8 hours…for an experienced REA I would say 4. Or maybe they have a clerk in the office that does most of that… just like a RE Lawyer.

So worse case 8 hours, then some other agent sells the house and they split $30K

LOL

For 8 hours work??!!

Or he sells it and keeps the whole $30K

#138 The contrarian on 04.23.13 at 11:42 am

“Canada is losing altitude and nearing a point of deflation, while the States reflates and rebounds. ”

Financially,U.S. is in the next Greece if not worst,headed toward bunkruptcy,and Canada will soon be.
http://bloomberg.com/news/2010-08-11/u-s-is-bankrupt-and-we-don-t-even-know-commentary-by-
laurence-kotlikoff.html

#139 T.O. bidding wars debunked - updated daily on 04.23.13 at 11:42 am

@ #115 Craig #117 Craig

Please indicate exactly the area (the intersection) and I will produce a map like this one: http://recharts.blogspot.ca/2013/04/to-bidding-wars-debunked.html specifically for your area with sales going back to max. 3 months. This way we can see if you are telling the truth.

#140 my thoughts on 04.23.13 at 12:02 pm

http://comfree.com/listing/print/code/411682
even if you outright buy this it costs you $9500 just in taxes and maintenance.

#141 bill on 04.23.13 at 12:08 pm

did someone mention uisge beatha???
my uncle Norman used to distill the good news back in the day when it was a 4 hour trip to civilization [nanaimo]….
it was usually blended with some ‘5 star’ .
a cup out and a cup in as I recall. had a bit of a sting in its tail. it was usually drunk neat without ice and followed immediately with a swallow of water in the ancient highland manner.

#142 Alberta Ed on 04.23.13 at 12:08 pm

We know several seniors retired in Sidney who now wish they were renting instead of owning. Increasing condo fees and special assessments are tough on those with fixed incomes. For those who want to sell, it’s not a happy place.

#143 AK on 04.23.13 at 12:11 pm

#130 Paul W on 04.23.13 at 10:23 am
“I also agree with Dr. Wayne, don’t hesitate hitting the delete button”
——————————————————————–
Right on Paul.
I am also sick and tired with all the ‘First’ Bullshit!!

#144 AK on 04.23.13 at 12:14 pm

#121 Ernst on 04.23.13 at 9:19 am
“re #109 Humpty Dumpty yesterday – thanks for zinging the troll AK/Wayne yesterday. Sweet justice.”
——————————————————————–
Ahh. My heart is bleeding.

Get a life.

#145 Craig on 04.23.13 at 12:23 pm

“This way we can see if you are telling the truth.””

Caledon and its the REA’s data not mine, so relax. Why would I lie….gezzzz.

#146 Flummoxed on 04.23.13 at 12:27 pm

Its cheaper to have a “lock down” than change all of the locks

“Liberty is lost through complacency and a subservient mindset. When we accept or even welcome automobile checkpoints, random searches, mandatory identification cards, and paramilitary police in our streets, we have lost a vital part of our American heritage. America was born of protest, revolution, and mistrust of government. Subservient societies neither maintain nor deserve freedom for long.” – Ron Paul

http://www.theburningplatform.com/?p=52862

#147 Mister Obvious on 04.23.13 at 12:32 pm

Re Today’s Picture:

Don’t try that at home kids. The girl you see is a trained professional.

#148 Je sais pas on 04.23.13 at 12:45 pm

Does anyone here have comparable info on Montreal?

#149 headhunter on 04.23.13 at 12:52 pm

me thinks that the kind Mr Tuner is now a “victim of his own success” excellent blog gartho I read it daily. You for sure should be given a gold start for waking up the masses… now that we are “awake” we realise that 1. all stock markets are cooked. 75% of trades are HFT’s and done by computer… front running is another term. 2. Joe average aint buying any stocks mostly institional buying.. joe average has no more disposable income left. record # of americans on food stamps but the dow is cresting higher? ( things that make you go hmmmmm.)
3. live each day like its your 2nd last and no use being the richest guy in the cemetary. Why save when the gov’t is just going to steal it from you via inflation and taxes

#150 Geelemitti on 04.23.13 at 1:02 pm

An agent bringing you selected comparables making you greedy and hot to sell. Who would have thought?– Garth

Still the ground facts r same. I am in the market as well to buy house in that area and so far went after 6 houses and all were sold on average for asking price. I got same comparison for each property I looked at with same results. 98-105% of asking with in couple of weeks.
Now to be exect we were told that houses were sold by the agent and I confirmed that few of the listings were removed, so not sure if they were actually sold or just taken off the market, examples r
W2600576
W2596144
W2600576

#151 Bottoms_Up on 04.23.13 at 1:02 pm

#37 John in Mtl on 04.22.13 at 9:55 pm
——————————————–
I think you’re wrong on that one John.

Toronto receives 20% of Canada’s immigrants:

http://www.toronto.ca/toronto_facts/diversity.htm

For round numbers, if immigration to Canada is 200,000 per year, well that’s 40,000 people added to Toronto every year. Families, well, that’s closer to 15,000 families.

So, you’re looking at 1250 real estate sales per month in Toronto due to immigration. And remember immigrants don’t only buy condos. Let’s say half of the sales are condos, so 625 sales per month of condos to immigrants.

90,000 condos, and 625 sales per month to immigrants, is a 12 year supply of condos (if only purchased by immigrants).

Nine of 10 immigrant families do not buy in the year they arrive. Just over 6 in ten do not buy within five years. Immigration of 200,000 a year cannot even pace Boomer retirements. This is a myth. — Garth

#152 Simon Cowell on 04.23.13 at 1:05 pm

There would be no increase in interest rates.

As no one will buy government bonds of highly indebted countries the central banks will monetize the deficits.

Apparently there are no currency wars , that is what the MSM proclaims. In reality everyone is debasing their currencies.

Inflation is being underreported, the CPI is very misleading. Same for unemployment and GDP.

The actual data/numbers that allow to make sound decisions are not available or misrepresented. How can correct decision be made based on wrong data?

People will be burned by inflation while that are lied to that no inflation exists. Central bankers will keep misleading that they are just about to stop the printing while in reality the printing will continue for years. They will keep saying that interest rates will go up (Marc Carney) while keeping them low.

People’s savings and capital will be burned to support the crazy growth ideas and deficit spending.

Somebody with access to the cash newly printed will start buying commodities at depressed prices. When the smoke clears people would be left with worthless savings, no capital and no jobs.

It seems this is random and misfortunate event. Under the cover it looks like part of a grand plan that started in Clinton’s era with the trade agreements.

#153 Uwinsome on 04.23.13 at 1:10 pm

Canadian Retail Sales Higher again:

http://www.cbc.ca/news/business/story/2013/04/23/business-retail-sales.html

#154 Oilsands Guy on 04.23.13 at 1:14 pm

It is different in Calgary – at least for the time being.

5 people/couples that are close friends have purchased homes for $600K+ in the last 6 months. People like this are keeping the market going. Also, a party in our townhouse complex tried unsuccessfully to sell her unit each of the last 3 springs with no success. This spring it was gone in 5 weeks. We also tried to sell our townhouse last summer/fall, with no success. This spring it was gone in less than 4 weeks. We’re taking the opportunity to cash out and break even for our time in this place. Things may or may not get ugly here, but we’d just prefer to be liquid and *flexible* so will rent for now.

I just noticed today that there seem to be less than 1/2 the amount of active listings in Calgary as compared to the Okanagan, which has 1/4 of the population and a totally dead economy (about to get even deader once the NDP governs BC and snuffs out any hope of business investment for the next 4 years).

#155 T.O. bidding wars debunked - updated daily on 04.23.13 at 1:37 pm

Caledon and its the REA’s data not mine, so relax. Why would I lie….gezzzz.
—————————–
Not on my map
You did not say you are not in Toronto.

#156 T.O. Bubble Boy on 04.23.13 at 1:39 pm

Nine of 10 immigrant families do not buy in the year they arrive. Just over 6 in ten do not buy within five years. Immigration of 200,000 a year cannot even pace Boomer retirements. This is a myth. — Garth

exactly!

Since when are all of the new residents of Toronto lining up at CityPlace to buy $400k 1-bdrm condos?

#157 maxx on 04.23.13 at 1:41 pm

#2 guelphstudent on 04.22.13 at 8:59 pm

…and a close family friend with a highly successful contracting business (government, commercial and custom design plumbing and electrical) has been saying for close to a year that business is way down….he’s not smiling the same way he used to.

#158 Mr. Plow on 04.23.13 at 1:44 pm

#154 Oilsands Guy

Nothing wrong with selling and renting, in any market, in any condition, owning is not for everyone liquidity/flexibility can mean more to one person than the next.

I still feel like over the length of our lives, since we all need shelter, owning is the way to go. You pay more up front, but you reap the benefits when you don’t have a mortgage and the guy who chose the rental route is still paying the same fixed cost; and you have an asset valued at ‘X’ when it’s all said and done.

Run the numbers over the course of your life (expected lifetime) and see what you come up with.

Alberta had 160,000 people move to the province last year, so that’s why you’re seeing the homes sell faster and the inventory levels lower.

Without jobs though, it could be a small blip on the radar. But… 30,000+ were created last year I believe.

These people don’t buy right away, they rent. Watch vacancy rates in Edmonton, Calgary, Red Deer… they are very low right now, if jobs continue to be created and they feel comfortable in their employment, those people will buy in the coming years.

Real Estate is all market dependant, when TO and Van were exploding, Alberta was in the basement, it seems the two largest Canadian markets are on the way down while our little province may be on the way up, at least for now. We’ll see what happens when rates go up.

#159 Mr. Plow on 04.23.13 at 1:46 pm

Re: Interest Rates

Whether you’re looking at the bond market or what the BOC does, rates are going up.

When? Who knows?

But, they can’t stay this low forever, hopefully the mortgage holders out there took advantage of the low rates to pay down debt and not take on more debt.

#160 ronthecivil on 04.23.13 at 2:09 pm

Had the mortgage broker come into the office and do a lunchtime presentation.

Most there were interested in options for refinancing.

I have seen investment guys come in before but says something that the mortgage guys are now going door to door peddling their services.

Oh, and Oban ftw peeps.

#161 dosouth on 04.23.13 at 2:11 pm

140- my thoughts on 04.23.13 at 12:02 pm
http://comfree.com/listing/print/code/411682
even if you outright buy this it costs you $9500 just in taxes and maintenance.
_______________________________________________

Type in for sale 3939 Duke of York Boulevard – Google – and see the 100 or so units for sale

#162 Dr. Hoof - Hearted on 04.23.13 at 2:14 pm

I sure hope those coffin – sized Condos don’t catch on.

I know its not an original idea, but when people get desperate they make stupid moves.

Sad reflection when people have to accept such crumbs.

#163 Craig on 04.23.13 at 2:31 pm

Caledon and its the REA’s data not mine, so relax. Why would I lie….gezzzz.
—————————–——————————————–

Not on my map
You did not say you are not in Toronto.

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

I’m NW of Toronto and houses are selling around the ask or above it. 98% to 105%

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

Try to pay attention Einstein before you call someone a liar.

PS- NW of Toronto means North West…gezzz

#164 my thoughts on 04.23.13 at 2:53 pm

#161.. I totally agree.. it’s amazing that there are so many listings at that one address. I just don’t know how people afford it! How does the average person make everything work. We are fine.. but when I look at the incomes of most people it just doesn’t make sense financially.

#165 Holy Crap wheres The Tylenol on 04.23.13 at 2:53 pm

#51 Post Haste on 04.22.13 at 10:15 pm

Case in point, 1st brother-in-law is a licensed plumber, just bought a home in Georgetown and signed off to a $545K 2 story home in the middle of nowhere. He tells us how in the past year the owner has got rid of 1/2 the guys – but he continues to think his $35hr job is good for life…I tell him to take caution, he thinks I am a fool – that housing will go on forever…he’s completely delusional – only a market fallout will wake him up!!

My 2nd brother-in-law is a even bigger boob, he quit his job that was secure – and now works as a sub-contractor painting homes – he mentioned 2 jobs in the past month – if his wife wasn’t putting in 55hrs per week – they’d be royally screwed..

Neighbour – now this is where I cheer for a housing correction – his is one of the biggest turd’s you’ll ever meet, he give’s most Italians a bad name – he works in construction and I pray every night that he loses his job – can’t afford his home or all the stupid toys he buys. Years ago he worked 6 days a week, and wasn’t home until 6pm each night – now he is lucky to do 5 days and is home after 4pm – I have my banner ready to say farewell A$$hole…
Those in the trades have better put some money away – as this is gonna be an ugly ride down –

Dear Post Haste,
My cousin just bought a 2500 sq ft Mini-McMansion in Georgetown at $635K, there was no bargaining for this home either. I couldn’t believe what they paid for this place. Then I found out the town is maxed out on builds no more building allowed at all. Demand is gaining as supply is slowing for these out of town homes. Here in Oakville same old same homes just insanely priced. Could be worse he could have bought a condo from Mr Lamb! Bahhhh

#166 AK on 04.23.13 at 3:07 pm

“End Permanent Alimony Forever Say Opponents”

Some good news for you Alimony Dudes.

Alimony

#167 betamax on 04.23.13 at 3:14 pm

What brand of scotch? I usually drink Aqua Velva.

It is not a scotch. It is an aftershave of the finest quality.

#168 Humpty Dumpty on 04.23.13 at 3:18 pm

Gentlemen….

AK, Espresso B, Stinky and others…

Lets us surrender our differences and agree not to jeer one another on His Highness Blog…
Of coarse the bearder one is exempt…

If you so chose to taunt someone, you must attach an article or a quote from that individual justifing your dig..

Let us act respectful towards one another while contributing reliable information….

Let us pledge an alliance towards liberty, peace and prosperity while The Oralce leads us to the promise land

Now….

Here’s an Armedillio Talking…

Merkel says euro members must be prepared to cede sovereignty

German Chancellor Angela Merkel said on Monday that euro zone members must be prepared to cede control over certain policy domains to European institutions if the bloc is truly to overcome its debt crisis and win back foreign investors.

http://www.reuters.com/article/2013/04/22/eurozone-merkel-idUSL5N0D92AS20130422

#169 Buy? Curious? on 04.23.13 at 3:29 pm

Subburbs, the graveyard of the poor.

http://www.huffingtonpost.com/2013/04/23/poverty-suburbs_n_3139192.html

#170 Ken R on 04.23.13 at 3:44 pm

Can you post a picture of your house and address, I’d like to see how wealthy you are to determine if I should take your advice or not.

If you behave I might show you my bike. — Garth

#171 jess on 04.23.13 at 3:45 pm

texas
investigation of Parkland led to the ouster of virtually all of the hospital’s senior leaders. …

Since early 2010, we’ve been investigating patient safety and medical supervision at the big public hospital in Dallas, one of the largest safety-net hospitals in America. What we found is that doctors in residency training at Parkland Memorial Hospital were not being properly supervised by faculty physicians from the teaching hospital’s academic affiliate, UT Southwestern Medical Center. The result has been needless and often tragic harm to Parkland’s mostly poor, minority patients. We further found – through a sophisticated data analysis of more than 9 million hospital records – that Parkland and UTSW were among the worst-performers in Texas on an array of patient-safety measures. Our related investigation into spending by UTSW’s former president found he had spent hundreds of thousands of dollars on foreign travel, wine and the opera, with no documented tie to the business needs of the medical school.

….Our findings contradicted the public images that both the hospital and medical school had carefully crafted for themselves as among the finest healthcare institutions in America. The investigation has been controversial locally because it called into question two of the state’s most-revered institutions that, while taxpayer funded, had previously been considered beyond reproach.,,

http://www.icij.org/resources/dont-get-lured-journalistic-group-think

#172 Ralph Cramdown on 04.23.13 at 4:00 pm

#152 Simon Cowell — “[… blah blah blah…] It seems this is random and misfortunate event. Under the cover it looks like part of a grand plan that started in Clinton’s era with the trade agreements.”

Funny, because back in the Clinton era they were blaming Reagan for cutting taxes while increasing defence spending, and deregulating the S&Ls. Reagan blamed Carter for telling people to put on a sweater instead of fixing the oil crisis. Funny, nobody blames Ford for anything… The goldbugs all blame Nixon, but back in the early ’70s everyone was blaming the Arabs and Johnson for his Great Society (or guns and butter, depending on who you asked).

I read a lot of investing books. I especially like reading old ones, for different perspectives. I haven’t run across one yet that said it was easy to create a low risk portfolio that beat inflation, no matter what era it was from. And it was the times when few were worried (think the 1920’s, the Nifty Fifty era or the dot com era) that ended up costing almost everyone a lot of money. Right now everybody’s worried, which means there’s a lot of stuff on sale. Build a portfolio and stop complaining. Or buy TIPS and stop complaining. Or short TIPS and stop complaining. Or buy Goldman Sachs and stop complaining. Or leave your money parked in a low interest savings account, safe from deflation but not inflation or other monsters under the bed, and stop complaining. But realize that, though it may have appeared so in hindsight, it has almost never been easy to protect wealth from inflation, deflation and other risks. Good luck.

#173 AK on 04.23.13 at 4:02 pm

#168 Humpty Dumpty on 04.23.13 at 3:18 pm
“Gentlemen….

AK, Espresso B, Stinky and others…

Lets us surrender our differences and agree not to jeer one another on His Highness Blog…
Of coarse the bearder one is exempt…

If you so chose to taunt someone, you must attach an article or a quote from that individual justifing your dig..

Let us act respectful towards one another while contributing reliable information….

Let us pledge an alliance towards liberty, peace and prosperity while The Oralce leads us to the promise land”
——————————————————————–
Okay. I am in.

But you have to promise to always use “Humpty Dumpty” when you post on this fine blog.

You need to distch your other ID’s.

Cheers.

#174 LTL_FTC on 04.23.13 at 4:22 pm

#55 Dan on 04.22.13 at 10:20 pm
Garth, what happens to city property taxes when house prices fall?

Dan – generally speaking, a city’s budget doesn’t go up and down based on assessments – it generally leaks upward a few percent a year – regardless of assessments trending up or down. If every property’s value dropped 10% one year, they wouldn’t get a 10% break – the city’s mill rate would just go up to compensate.

If one property dropped 10% and the rest of the city stayed static and had no budget increase, that one property could expect to see a 10% tax drop while the rest of the city would share the tiny increase to offset.

In BC at least, values are determined by BC Assessment and are effectively 1 year behind (2013 taxes are based on 2012 values). Property taxes are based on assessed values which many not necessarily be the same as the most recent sales price.

If all values truly were plummeting in a city, there would likely be budget/property tax implications. This includes things like net migration as property owners come and go from the region.

#175 Tom Vu on 04.23.13 at 4:32 pm

DELETED

#176 The Prophet Elijah on 04.23.13 at 4:49 pm

#136 Victor V on 04.23.13 at 10:59 am
Bank of Canada repeats language on higher interest rates

Reuters – 1 hour 44 minutes ago

http://ca.finance.yahoo.com/news/bank-canada-repeats-language-higher-interest-rates-130421203–business.html

OTTAWA (Reuters) – Outgoing Bank of Canada Governor Mark Carney on Tuesday repeated the central bank’s warning that it expects its next move to be an interest rate increase, even after recently cutting growth forecasts.

“The considerable monetary policy stimulus currently in place will likely remain appropriate for a period of time, after which some modest withdrawal will likely be required, consistent with achieving the 2 per cent inflation target,” he told a Canadian parliamentary committee.
—————————————————–
This is the equivalent of a US Fed member saying QE will be shut off soon. Then they never follow through cause they know they can’t.

Didn’t I punt you? — Garth

#177 The Prophet Elijah on 04.23.13 at 4:52 pm

#47

The worst part is, because I don’t share their enthusiasm in the housing market, they make me out to be the bad guy rooting against them. I can only try to tell them that I’m a friend and I don’t want anything bad to happen but that doesn’t mean I will agree with every decision they make.
———————————————————
Exactly. That’s why I don’t bother saying anything anymore, it doesn’t make you popular at cocktail party’s. You describe about 90% of people above.

#178 rosie "moving forward" on 04.23.13 at 5:03 pm

#170
This here is my house/office. Them there is my team of crack advisors. I’ll handle your money. No problem. http://cmsimg.detnews.com/apps/pbcsi.dll/bilde?Site=C3&Date=20110605&Category=OPINION03&ArtNo=106050313&Ref=AR

#179 jess on 04.23.13 at 5:05 pm

by JM Winer – 1998 – At the recent Sixteenth International Symposium on Economic Crime

He asks : What is really offshore in a globalized
economy? What is really onshore? How can anyone tell the difference?

replacing safe havens for safe system
http://sas-space.sas.ac.uk/3972/1/1519-1826-1-SM.pdf

…”They do not merely devastate depositors and creditors and leave, in most cases, losses so large that governments and their taxpayers are ‘required to bail out the victims. They have been warning signals,
over the past decade, of the risks of an unregulated international financial services sector that continues to demonstrate its inability to police itself.”

push and pull
e.g.
For example, the collapse in 1995 of Latvia’s largest commercial bank occurred because the bank had been controlled by a criminal group, that used the bank to make bad loans to its front companies and defrauded the bank’s accounts of as much as $40m. That collapse provoked a major financial crisis in Latvia, contributed to a change in the government, and forced Latvia to
seek short-term assistance from the International Monetary
Fund (see President’s International Crime Control Strategy, TheWhite House, May 1998, p. 18). Similarly, a series of pyramid or ‘Ponzi’ schemes in Albania last year stripped the country ofmore than $250m in capital, causing the government to collapse, as hundreds of thousands of impoverished refugees
fled to Italy.

#180 Humpty Dumpty on 04.23.13 at 5:12 pm

Well that story looks familiar….

Proverbs 6. 6-11

Go to the ant, thou sluggard; consider her ways and be wise:

which having no chief, overseer, or ruler,

provideth her bread in the summer, [and] gathereth her food in the harvest.

How long, sluggard, wilt thou lie down? When wilt thou arise out of thy sleep?

A little sleep, a little slumber, a little folding of the hands to rest!

So shall thy poverty come as a roving plunderer, and thy penury as an armed man.

Kung Fu – Grasshopper dialog
http://www.youtube.com/watch?v=WCyJRXvPNRo

Tom Vu…

Never assume because a man is blind, he can not see..

Ak..

there’s only one egg head on the blog, I mean wall…

#181 Tom Vu on 04.23.13 at 6:21 pm

#177 The Prophet Elijah on 04.23.13 at 4:49 pm

Didn’t I punt you? — Garth

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

You tried, but ref threw flag 3 times and you gave up a safety.

#182 Chickenlittle on 04.23.13 at 6:28 pm

not 1st on 04.22.13 at 11:11 pm
Garth, don’t pretend that the americans are some sort of model prudent consumer that knew exactly when to reduce their spending.

I have to agree with you. My inlaws are buying a house and they told me all they need is 3.5% down. Then again they are buying in the Detroit area, so the max they will spend in $120k. Lucky them!

CrowdedElevatorFartz: Yes, this chicken has hair. I’m a special breed. I know I’m asking for it by posting this, but I can take a joke! :)

#183 happytimes on 04.23.13 at 6:37 pm

Yup, USA is the grasshopper:

America: #1 In Fear, Stress, Anger, Divorce, Obesity, Anti-Depressants, Etc.

#184 happytimes on 04.23.13 at 6:38 pm

Tyler Durden’s picture
Guest Post: America: #1 In Fear, Stress, Anger, Divorce, Obesity, Anti-Depressants, Etc.

#185 Devore on 04.23.13 at 7:11 pm

#117 Craig

You can find a more objective TO analysis than that from comparables brought to you by an agent angling for a client here:

http://recharts.blogspot.ca/2013/04/to-bidding-wars-debunked.html

#186 Timbo on 04.23.13 at 7:12 pm

http://www.huffingtonpost.ca/2013/04/23/canada-house-prices-us_n_3139918.html

“A 62 per cent gap is simply not sustainable for long,” Porter wrote in a note to clients”

for long? how about now……………….

http://www.huffingtonpost.ca/2013/04/23/epa-criticizes-state-department-keystone-report_n_3135680.html

“It urges the State Department to rethink its finding that the controversial pipeline would not significantly spur production of Alberta’s carbon-intensive oilsands or boost greenhouse gas emissions.”

never mind the Ogallala Aquifer right?………

#187 TurnerNation on 04.23.13 at 7:18 pm

Someone took this scotch-fueled weblog literally?

(Me – I like dark beer – Muskoka Dark, Coffee Porter, etc.).

http://www.cp24.com/news/police-seek-suspect-in-theft-of-rare-scotch-1.1250141

TORONTO – Toronto police are looking for a thief with expensive tastes.

They say a man went into a downtown liquor store earlier this month and went to the vintage section, where he selected a rare bottle of 50-year-old Glenfiddich Single Malt scotch.

The 700-millilitre bottle, which was in a glass case, is worth $26,000.

#188 Alex K on 04.23.13 at 7:31 pm

#115 Craig
I live in Richmond Hill and have been following the market rather closely ever since I sold in 2011 and can report that prices are down and things are not selling the way you claim< I understand "denial" things are different here? Guess again.
Went out for friends birthday last Friday and because I'm a proud renter now people always want to talk RE< My friend Larry thinks prices are also up and I maybe missing an opportunity< Yeah right<
#74 timmy, 20% drop would have meant over 300G's less in my bank account but still would have been up big time but but but 300's timmy think about that.

#189 Daisy Mae on 04.23.13 at 8:04 pm

#141 Bill: “…it was usually drunk neat without ice and followed immediately with a swallow of water in the ancient highland manner.”

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

This was the way my mom drank….once a year at Christmas. :)

#190 CrowdedElevatorfartz on 04.23.13 at 8:06 pm

@#188 Turner nation

Anyone that would pay 26k for a bottle of glenfiddich is insane.
Doesnt matter if the Glenfiddich is 5, 10, 15 or 50 years old…. it all tastes like regurgitated seagull gack.
Glenfiddich, brrrrrrrrrrrr, gives me shivers just recalling my last involutary sip of that swill…….

In my humble opinion…… of course.

#191 Devore on 04.23.13 at 8:07 pm

#117 Craig

Well, never mind, looks like some further information has come to light here.

Each area is different. I don’t understand why people expect their area must have either collapsing prices immediately, or it’s different here and will keep going up forever. This is a market that takes months to show a couple percent change, go sit on your porch and have a beer.

#192 :):(Ying Yang on 04.23.13 at 8:16 pm

Grasshoppers, ants,locusts all these bugs homeowners have a lot to be worried about. Just waiting for the cockroaches to come in and feed on the left over garbage when homeowners loose!

#193 CrowdedElevatorfartz on 04.23.13 at 8:47 pm

@#141 Bill
I also had an Uncle that produced some of the purest “shine” known to man.
His way of testing and proving its purity.
He would pour some into a tablespoon.
Hold the spoon about 3 ft above a table.
Light the “shine” on fire.
Pour it onto the table.
If it remained lit when it fell and then splashed across the formica……..THAT was good ‘shine”
He always commented that Quebec Alcool was for wimps. Not strong enough. :)

#194 Ronaldo on 04.23.13 at 9:12 pm

#108 Bigrider – if you were a developer and you could cash in and collect huge profits immediately and be able to pass on the costs and problems associated with ownership to someone foolish enough to buy these things, why wouldn’t you? It’s just good business. Problem now in Toronto is these developers may become reluctant landlords. All good things come to an end eventually, right?

#195 Marty on 04.24.13 at 7:50 pm

#55 Dan
In La Belle Province, town taxes won’t be the problem in the short term. After the 200$ per adult health fee will come major increases in school tax.my bet is 200-300$ in the next couple years.