It’s showtime. Over the rest of this week local real estate cartels across the country will be releasing their latest stats. Some will use figures which will be compared to previous numbers which were secretly altered. Others will hide behind a manufactured Frankenumber designed to obfuscate and confuse. A few will tell the truth. Good luck.
So who can you trust? The GreaterFool Research Department, of course. We have several reports.
First, here’s Dan in leafy Victoria, where realtors have just published the toll for May. Summary: sales flat and prices down. There were 384 SFHs changing hands at a median price of $515,000, which is 3.4% lower than a year ago. But the big story is illiquidity. There are almost 170 houses currently sitting on the market for between $1 million and $2 million, and just 16 found buyers last month.
Okay, Dan, whaddya seeing?
As May comes to a close I look at the range of homes I’ve been keeping an eye on in Oak Bay (the opulent area of Victoria as you know) $500,000 to $800,000 and over the past two weeks I moved the upper parameter to $900,000. Anyway, there were only 6 sold this months and none since May 16th. Last month there were ten, the month before many more. So the “watch that date of May 19th” you referred to seems to be right on. Many realtors going hungry considering other occupations no doubt.
Now to Toronto, where by mid-May sales were off almost 10% from the same time a year earlier, and down closer to 12% in the core. Condo deals, in fact, were 13.6% fewer in 416, with prices stagnant. Activity for detached homes above the $1 million mark has also been moribund. But prices are ahead 5.2% overall. Huh? What gives?
Well, all the action in the GTA has concentrated in a narrow price band, basically between $500,000 and a $900,000, for which you get a shack on the Danforth held up by termite spit. Here we’ve seen multiple offers, along with copious wailing and moaning. In other words, a most unhealthy market overall, with fewer buyers chasing diminished listings in a skinny segment. Meanwhile 63,000 condos march relentlessly to market, guaranteeing a crap storm to come.
Our correspondent, Michelle, is there:
I’ve been following your blog for about a year now, renting for 3 years in a downtown Toronto condo, and long the U.S markets for about 2 years. Life is good on my end. Just wanted to share what I’ve been seeing: My neighbor, let’s call him Unit #3, has had his condo listed on MLS for probably at least 6 months by now, revised his price down once already (for now), and even put up new pictures of restaurant patios in the neighbourhood (great neighbourhood indeed, hence why I live here). About one or two weeks ago, my other neighbour, Unit #4, put up his condo on MLS, with the same layout as Unit #3, for $20k less (or about 5% less, does not sound like much but that’s an agents’ commission and this is probably just the beginning of what could be a fierce battle). These two live next door to each other. I think this is the tipping point for condo prices..it’s about time.
Now, a quick detour to Ottawa, because Chris needs our help.
My wife is smarter than I am. It’s a fact with which I’m very comfortable. I’ve been spouting the doctrine of Garth for years, now. But she’s wily, see? She now reads your blog to track the number of times Ottawa does not appear as a fish for your fileting. I keep telling her, look, Garth may have some psychological block against the place having endured a job in the P.C. and then all the fun he suffered under Harpo, The Dougster (RIP) and his never ending sniping at the King of Gnomes, F himself. But, that economics, demographics and the bond market don’t play favourites.
She don’t buy it.
The rub: we owe 65K on our mortgage. House bought in ’03 for 319K, latest assessment was 616K (a joke). She’s eyeballing a swell little quartier nearby (Manor Park), where tear downs go for 600K and their reborn versions 850K. Our combined income is $274K before tax. I keep telling her: the market will correct, but besides that, we are not in the business of buying $850K houses… We must wait, the day of the vulture will arrive. So she says: ‘Right. Ask Garth. See what he says.’ And so here I am.
Dear Chris’s Smart Wife: Since you married a wimp, I am happy to respond for him. Ottawa is not different. It’s worse. The latest estimate is that 26,800 federal civil service jobs will be phased out between now and the next federal election (autumn, 2015). You don’t need me to tell you the impact that will have on a real estate market where barely more than 10,000 properties a year change hands.
Sales in Ottawa were down 13% in the first quarter of the year then recovered to flat in April. Prices are up a little less than inflation, at 2.1%. The new house market is completely overbuilt (thank you, Mattamy) with starts up1% this year while Toronto was down by 45%. Won’t be long now before the elfin deity’s magic anti-housing pixie dust blows your way from the Peace Tower.
But, wily babe, are you actually sitting on $300,000 in windfall capital gains in your house, with an income of $274,000, and scant debt? Do you both have indexed pensions, too? And the worm won’t buy you a lousy nice house? I bet he sits up at night and reads this pathetic blog, too, while you lie, abandoned.
I am so sorry.
129 comments ↓
A long/covered call fund:
U.S. Housing Recovery Fund Announces Monthly Cash Distribution
TORONTO, ONTARIO–(Marketwired – May 22, 2013) – U.S. Housing Recovery Fund (TSX:USH.UN) announced today cash distributions for Class A and Class F Units. Unitholders of record at the close of business on May 31, 2013 will receive cash distributions of $0.05 per unit, payable on or about June 14, 2013.
http://www.bmocm.com/investorsolutions/closed-end-funds/us-housing-recovery-fund/
Holdings click on: Quarterly Portfolio Disclosure, as at March 31, 2013
Hi Garth,
Thanks for all the posts. I am just wondering, do you have any recommendation on how to deal with the recent massacre in REIT prices?
Thanks.
On sale. And you have a weird definition of ‘massacre.’ — Garth
Maddie! The coon hound. You have found this great blog!
But, wily babe, are you actually sitting on $300,000 in windfall capital gains in your house, with an income of $274,000, and scant debt? Do you both have indexed pensions, too? And the worm won’t buy you a lousy nice house? I bet he sits up at night and reads this pathetic blog, too, while you lie, abandoned.
I am so sorry.
A hint of sarcasm, written with a smile I’m sure.
May not be first, but am ahead of you…
It seems that everyone around me thinks house prices will go up forever. Especially people who own houses in Toronto. I don’t want a crash, but more and more debt and monster mortgages, coupled with rising rates seems to spell trouble in the not so distant future.
http://recharts.blogspot.ca/2013/06/to-sfh-bidding-wars-debunked-june-03.html
http://recharts.blogspot.ca/2013/06/gta-sfh-bidding-wars-debunked-june-3.html
Wily babes? This truly is the blog with everything!
Speaking of the sub-$1M market in Toronto, some of the SFHs that surely would have been in the $1M-$1.2M range have now come down to try and catch those CMHC-backed mortgages:
$999,000
$995,000
$995,000
$985,000 (52×147 ft lot)
and, just to mix it up a bit, the typical crack shack or mansion listings:
http://www.realtor.ca/propertyDetails.aspx?propertyId=13065562&PidKey=-1477600173
http://www.realtor.ca/propertyDetails.aspx?propertyId=13181797&PidKey=312706240
Hopefully Calgary follows the trends of these cities.
So here’s some interesting tid-bit.
In my neck of the woods in South Surrey, BC.. I couldn’t figure out for the life of me why so many NEWLY ARRIVED to Canada home builder companies continue to build homes in a depressed RE sales market, and nothing is selling. For Sale signs everyWHERE. Not one SOLD sticker.
Also.. There is not 1 Caucasian builder anywhere in the area.
Low and behold.. I found out why! The NEWLY arrived Canadian builders are not getting their funding from the BANKS like most builders do…. they getting them from the temples! Build build build! Keep the jobs going for the congregation, and all will be happy. Payback when you sell. No hurry!
Not a word to anyone! Please… Don’t want this to get out to the masses! It’s a big secret!
Badges ? We don’t need no stinkin’ badges…
been reading the same old same old stories, lines, reasons… excuses for years now!
prices increased 50% over the past few years…. 10% decrease (even 20%, if ever) would not mean much for those waiting!!! – if ever it happens, it will take years!!
Speaking of Riverdale properties held up by termite spit. 1.2mil. Are they kidding?
MLS® E2625193
http://www.realtor.ca/PropertyDetails.aspx?PropertyID=13139860
ASSESSMENT TIME
Just got my property tax assessment in the mail.
This is for perhaps the best suburb of Edmonton, St. Albert.
Up by 3%. This gets it back up to exactly the same as 2011 and 2009 and still lower than 2008.
Property taxes at $3831 work out to 1.0% of the assessed value. I don’t begrudge that. When we bought the house 18 years ago it was assessed at $120,710 and taxes were $2260. That was 1.9% of house value per year.
So our property taxes have gone up a compounded 3.0% per year.
The assessed value of the property has risen 6.4% per year. (Not suggesting that will continue, that is just the history)
Property tax is one of the most honest taxes because when they announce a 3% property tax increase they mean after adjusting for inflation.
That is, if house prices double and they announce a 3% tax increase your tax bill goes up 3% not 103%.
So credit where credit is due, the property tax system is an honest tax and at $3800 for a suburb house worth $368k, I think it’s pretty efficient. I have no complaints about property taxes.
I’m not feeling well today. I’ll read the rest of this blog tomorrow. Good night guys. see you tomorrow.
Hmmm, not sure I’d call 500-900k a narrow band. It’s also *the* band in the GTA.
Garth, I agree 100% with your point on illiquidity and I can see it with my own eyes in Ottawa. I have been tracking MLS listings here for several years. In a 30 km radius, there are currently 25% more listing than last year and 57% more than in 2011. In the suburbs of Ottawa, very few houses above 500k are selling. For every house that sells, there are several that have been lingering on MLS for over a year (a few as many as three years!!!!) and, again for every house that sells, there are several that have been taken off the market. Houses rotting on MLS for not months, but years! I call this a SICK market. Nothing healthy about it.
Any info on Montreal, dude?
Garth,
You really should put a facebook like on your pictures…. Where do you find them??
I by the way own a Kia….
[…] via Almost there — Greater Fool – Authored by Garth Turner – The Troubled Future of Real Estate. […]
#15 Shawn on 06.03.13 at 9:50 pm
ASSESSMENT TIME
=================================
Not sure your point
Is it Bend Over and leave the driving to Gov’t ?
Many Local Gov’ts seem to have it written in stone that they deserve these increases > 3%
Never ignore the compounding factor, nor that growth in a city adds to gross total revenues.
Most Local Gov’ts also ratchet up DCC’s and other fees…but what is the money spent on ?
My point= Don’t be fooled by BS stats..
This years CANADIAN Bilderberg 2013 attendees
Clark, W. Edmund President and CEO, TD Bank Group
McKenna, Frank Chair, Brookfield Asset Management
Prichard, J. Robert S. Chair, Torys LLP
Reisman, Heather M. CEO, Indigo Books & Music Inc.
Wall, Brad Premier of Saskatchewan
Weston, Galen G. Executive Chairman, Loblaw Companies Limited
New construction – Not sold in 8 months @$729,900, so they up the price $40,000 to $769,900
http://www.viewpoint.ca/property/cutsheet/41237470?no-nav=1&no-footer=1
Great part on Ottawa. Properties have been sitting for months and months here, in some cases, over a year.
Folks if you are self employed then forget about getting a mortgage. I just had a client declined for a purchase with 50% DOWNPAYMENT! Yes , 50%. Perfect credit, real business for 6 years with very reasonable stated income , substantial liquid assets remaining after downpayment and the insurer of the “stated income” product said NO.
And this is the same mortgage insurer that will approve a McDonalds burger flipper who has a job for 6 months at 5% downpayment.
Goodbye Canadian Real Estate. The mortgage insurers have officially pulled the plug.
This ones been on the market since 2008!!
The price is up, down, up, down……, and now raised just recently. Note this is a rural area that has been hit hard economy wise a few years back.
http://www.viewpoint.ca/property/cutsheet/00947630?no-nav=1&no-footer=1
“I’ve been following your blog for about a year now, renting for 3 years in a downtown Toronto condo, and long the U.S markets for about 2 years.”
Garth’s dream woman has been found.
$275K pre-tax income + $500K+ of equity, and there’s a concern for a $850k house? that’s tight… but, whatever.
And meanwhile a Vancouver penthouse sells for $25M
http://www.cbc.ca/news/canada/british-columbia/story/2013/06/03/bc-vancouver-most-expensive-condo.html
cbc’s top story….let’s keep pumping!
Vancouver is conspicuously absent in May numbers posting. So whuzzup? Maybe….just maybe Vancouver is different but the boomers can’t possibly entertain the notion they’ve sold their children out…..so hollow are their responses to the disaster that globalization has been for the children of the boomers. Yes globalisation was inevitable but no one said we had to wave our fat sluggish asses on the street without demanding some basic protection for Canadian values.
The belief that the marketplace will eventually set things right by rewarding those who actually produce wealth is wishful thinking and sadly typical of the ideologically calcified Canadian conservative movement. They have created a society that has rewarded highly leveraged bets with risks offset by political class.
#27 [email protected] — “I just had a [self employed] client declined for a purchase with 50% DOWNPAYMENT!”
The question to ask is “What kind of a pussy-assed lender won’t lend to someone with reasonable income, other assets, perfect credit and 50% down, unless it’s insured? Is their underwriting department a Magic 8 Ball?” Oh, wait, they didn’t want to lend your client THEIR money for five years, they wanted to lend your client money just long enough to bundle the loan into an MBS and sell it to someone else. Where have I seen this movie before?
#27 [email protected] on 06.03.13 at 10:49 pm
=====
Go to biker bar…ask for Knuckles…(He drives KIA)
He set you up with make -up artist,costumes, fake ID ….yada yaduh
Includes documents that say you are (i) refugee or (ii)
chopstick recycler or(iii) ____(get creative dumba$$)
Should get mortgage for at least $500,000..
Life is not fair unless you play dirty !
@ #28 Sparky55
You’re telling me the rents are 1450+ on that place paid by real live tenants and they can’t find anyone to buy it at 99k? I’ve never seen a property in ON, QC, BC or AB that cash flow positive in my life.
#20 Montreal is not in an housing bubble, unlike the rest of the country. Prices and demand keep rising here. It’s a great time to buy in Montreal, especially condos. You are sure to make a killing!
Seriously, what is wrong with a KIA?
I would not hesitate to buy one if money was tight.
But then, I would probably buy a used top rated vehicle instead.
GOVERNMENT and Taxes
Dr. Hoof-Hearted at 23 said to me:
Not sure your point
Is it Bend Over and leave the driving to Gov’t ?
***************************************
No, my point was that my taxes went up 3% per year on average for 18 years while property assessment went up 6.4% per year on average.
And my point was that people always whine about government but at least the property tax increase is honestly calculated. Income tax goes up automatically as incomes rise. Property taxes however only go up by the announced increase say 3%. When house prices tripled and quadrupled, property taxes did not.
Also a property tax that is 1% of my assessed value does not seem onerous to me.
I do my own driving. But I leave policing and road maintenance to the City and fire fighting too and a little thing called public school education is also funded from property tax and a subsidy to public transit (which I fully support) and economic planning and some community support programs and other services that are necessary but not covered by user fees. We get our streets plowed regularly in winter and they do a GREAT job. Never any snow bank left across my driveway.
Life costs money. Government services not only cost money but are worth money. Is there some waste and too many government people paid too much? Yes probably so, but overall I don’t see much to complain about on my property tax bill.
I make money and I pay my share of taxes without complaint. When I want more I don’t whine, I work harder.
Frankly it is a great privilege to live as we do in Canada in the year 2013. To my mind it is the greatest time in the history of the world to alive and we live in one of the better countries. They say the 1950’s were rather grand, well except for the 45,000 Canadians that never made it out of the 1940’s due to getting killed in the war. And many of the 54,000 Canadians who were wounded did not have such a grand time either. And in those days it was not unusual to die of childhood illness. So yeah you better believe 2013 is one heck of a great time to be alive. And government is part of the reason. If you don’t believe it try anarchy and see how long you last.
And if you think women did not have to work in the 1950’s then think about how cooking was in those days. Those were the days of mending cloths and putting up preserves and doing laundry in a wringer washer partly or hand. And pampers were not yet available and women had four kids each average. That’s a lot of poop to wash out. Think hanging heavy cloths on a line was charming all the time? Yeah the 1950’s Mom would probably think today’s women have it not too bad.
Our whole economy is a giant interconnected system. It’s all about specialization of labour and assembly lines of various sorts. None of us would be anywhere near as well off and comfortable without the system. Government is a necessary part of the system.
Those who see government as 100% waste are misguided fools.
We stand on the shoulders of our ancestors and we could show a little gratitude once in a while.
And out kids stand on our shoulders and along with some debt are inheriting a lot more assets than debt believe me.
Chris and Smart Wife,
Sell your place, take the Money and run! Go rent one of those places you have been looking at buying. If you can’t afford the rent, Invest your money, and use the returns to subsidize your rent. The principal will be real money, not paper returns on your assessment. And when your dream place is for sale at a realistic price, buy then and only then. The patience is hard to find, but freedom of choice is much more palatable than the bonds of mortgage slavery.
I hate visiting friends who live in condos. They keep trying to tell me how much their place has appreciated since they bought or how great it is to have so many cool bars and restaurants nearby. Yeah right! Condo fees are what, $800/month and pints go for $7. “You’re retarded!” I think to myself. (I’m too polite to tell them how retarded they sound plus they’re giving me a visitor’s pass to the underground garage for the night. Police and their spot checks, bastards!) I know of a woman who lives in one of the condos off Niagra and at first she’d leave a drying rack out on her balcony until one time a cigarette butt landed on it and start a small smouldering fire on one of her polyester blouses. What she’s doing wearing polyester is not the point. The point is that living like caged animals on top of each other causes more problems than it’s worth. I’d suggest getting a motorhome. There’s a great parking lot at Home Depot in Leaside.
http://www.youtube.com/watch?v=pZTcLc4BPIU
“The penthouse at Vancouver’s Fairmont Pacific Rim has sold for $25 million, making it one of the most expensive condos ever sold in Canada, CBC News has learned….The listing agent, Malcolm Hasman, refused to say who the buyers are or to confirm the price. However, sources tell the CBC that members of a wealthy Middle Eastern family were in town last week to look at properties in Vancouver.”
http://www.cbc.ca/news/canada/british-columbia/story/2013/06/03/bc-vancouver-most-expensive-condo.html
OK, what exactly is going on? House bought in 2003 for 319K. Mortgage … lets guess… around 300K. Your income is 274K. In 2013 you have 65K left on your mortgage. So … you have been paying off your mortgage at a speed of 23K/year.
Conclusions:
1. You should have AT LEAST $1,ooo,ooo in a bank by now.
or:
2. You should have AT LEAST 10 kids going to college with RESPs of $5oo,ooo in total.
If none of these is true… than what is your plan for the next 10 years? Tell us more about that.
#15 – Shawn
Honest taxes – bit of an oxymoron don’t you think. The $3200 on average plus per year you’ve been paying for those 18 years- take that $57,600 plus out of your profit plus repairs etc and you could have had one heck of a TFSA in REIT’s and a few holidays to boot…..
Honest tax???? – if you say so
Sorry #15 Shawn – your version of a good deal $3800 for a $368k house??? Our last house in the Okanagan we sold in 2012- $680k taxes were $3680. Now accordingly this would be a screamer of a deal…..no?
$274 combined household income in Ottawa
Your tax dollars at work, folks. Keep feeding the beast. Meanwhile enjoy being told what you can eat, drink, afford, buy, sell, build, trash, break, repair …
[…26,800 federal civil service jobs will be phased out between now and the next federal election..]
I believe it when I see it. The phase out will come with golden parachutes, I’m sure.
Forget hockey. Canada’s national sport and favorite past time is paying taxes. Has to be.
“An astonishing 42 per cent of Canadians under age 29 still lived with their parents in 2011, compared to 26 per cent in 1981, the federation said.”
http://www.news1130.com/2013/05/30/canadas-big-city-mayors-demand-commitment-to-solve-housing-crisis/
“Diane MacKay, of the Conference Board of Canada, said the housing crisis that has been unfolding for years has all kinds of impacts, including on the ability to draw workers.
The problem is more prominent in Western Canada, including Saskatchewan, she said.
“Even housing for executives is at a state of crisis, because you cannot attract talent at that level unless you have good housing, located near good schools, with good access to services of all kinds including culture and health care and so on. It’s a problem at all levels of the economy.”
The solution requires more than government funding, she said.
“The governments should not be in the business of building housing. The governments should be in the business of setting policy,” she said.”
http://www.news1130.com/2013/05/30/canadas-big-city-mayors-demand-commitment-to-solve-housing-crisis/
For anyone interested in the debates over QE, there are a couple of good pieces here:
First, Pawel Morski argues in favour of QE (because it’s better than nothing)
http://pawelmorski.com/2013/05/29/qe-because-nobodys-got-any-better-ideas/
On the other hand, Frances Coppola argues that QE has made things worse, especially in the UK
http://coppolacomment.blogspot.co.uk/2013/05/inflation-deflation-and-qe.html
Not exactly a ringing endorsement of central bankers either way. After interfering in (and wrecking) global markets (US, Japan, Europe, UK, Canada), they are now faced with nothing better than QE to try and fix their messes.
But they saved our asses, yeah thanks for that.
DELETED
A leading Fed official has guaranteed that bond purchases won’t be tapered until at least this September at the soonest!
That means that this latest stock market drop has been all for nothing, and now is one of the BEST of times to load up on U.S. stocks. So buy ‘SSO’, ‘DDM’, and maybe a few other exchange ETFs and profit big-time between now and August.
As for that KIA in the photo: Yes, those early KIA cars were just horrible. Even the latest Hyundai cars are not all that great in terms of Engineering, at least not compared to what Toyota has to offer. However, I have been doing reviews of the latest Kia Forte, and the EX with the 2.0L engine is a rocketship, similar to that of the Golf GTi, just without the massive maintenance nightmares of a typical VW.
June 6 will be the unveiling of the new Corolla. It is supposed to have a new CVT transmission that will get outstanding fuel economy. I drive a 2006 model and i bought it used because the 2010 Corollas were just AWFUL: worse steering and far-worse braking than the older 05-08 models ! I hope Toyota fixes all this with the new 2014, or else the new KIA Forte EX, with the 180 hp 2.0 L engine will eat Toyota Alive !
Garth, do you get bored at being right all the time?
Check out this little diddy from none other than Dr. Doom, Mr Nouriel Roubini, the second sexiest person in economic blogging (Who’s the first? I’ll give you 3 guesses but the first 2 don’t count). Here he is talking about how gold investments were for scared grey haired dudes that watch Fox, Glen Beck, and vote for crack smoking politicians.
http://www.economonitor.com/blog/2013/06/after-the-gold-rush/?utm_source=contactology&utm_medium=email&utm_campaign=EconoMonitor%20Highlights%3A%20Time%20Travel
Where’s Smoking Man?
KIA = Killed In Action. I guess it’s better than DOW.
Early August reporting will show how right GT is.
Home ownership and apple pie….
#38 Shawn – here, here! You get what you pay for, and I’d prefer a well-run country, paved roads, good healthcare and services to help the poor, disabled, unemployed etc. so that society functions well as a whole. Since we all live together, it makes a difference to your well-being if you’re stepping over homeless people all day, even if you’re not one of them. And even though I gave $10 yesterday to a girl who couldn’t have been much older than 16 with her worldly belongings in a backpack, I know it’s not enough to save her from what’s waiting for her here. This is why we pay taxes, or should be at least. It’s an expression of our collective power to take action. I like the property tax because it’s a tax on wealth, not income, and that is part of the remedy needed to re-distribute wealth in our society that has gone so haywire. There’s a big debate about paying more tax in Toronto for decent transit – maybe $500 a year per household. And yet people complain! If I was a company huckster who said I had a magic device that would save you 100 hours a year of being stuck in traffic for a mere $499, people would eat it up. Better yet, it’s a magic device that helps you, even if other people use it. Sheesh!
liar loans – falsely inflated mortgages involving more than 200 properties between 2006 and 2007
http://www.cbc.ca/news/canada/story/2013/06/03/bmo-lawsuit-mortgage-fraud.html
While I fully realise that a stat on “one” property does not make a market…….watching the same house for 8 months can get interesting.
In the high end inner city area populated by $750K+ SFH where I rent here in Calgary………a house on my street was recently de-listed after 8+/- months on the market with a couple of different property pimps.
I watched it go from $1.2MM down to…..$1.1MM…..$999K……$979K……$959K……$949K……$899…….death by a thousand cuts, and no takers. It even had the proverbial “legalised” mortgage helper, or as the last listing so eloquently put it “carriage house”……..which was nothing more than the double car garage attic which was turned into a flat.
There are hundreds of these places around……..cardboard “lego land” mirror images of each other……….all with shingles on the grass, what little of that you get nowadays.
#43 screwed,
thank you for your continuing efforts to give us the unscrewed, untaxed society.
Here is some ammunition for you:
http://www.tbs-sct.gc.ca/pubs_pol/hrpubs/coll_agre/rates-taux-eng.asp
I always imagine the GF research dept. as a room full of graying men in suits, bifocals perched, sitting in overstuffed chairs, with brandy snifters at side, reading worldly newspapers such as The Times, and occasionally letting out a loud “harrump” while re-crossing their legs. Am I far off?
Except for the lap dancers. — Garth
#20
#36
Montreal housing market is the worst of the country, just next to Vancouver city.
Montreal has nearly as many homes for sale right now as Toronto and Vancouver combined.
(did you get that ? combined)
http://theeconomicanalyst.com/content/canadian-housing-and-economic-trends-good-bad-and-ugly
And Montreal is the poorest of the 3 with the lowest income and the most taxed buyers.
You hear a lot about Vancouver and Toronto here. But Montreal will be the real shocker.
REIT prices are down Fnnn awesome, means that I get a higher yield and my money and my dividends go further LOVE IT
I interact with a couple of federal government offices in southern Ontario. When attending meetings, I have several times in the last six months noticed new faces, replacing old contacts who were near retirement age. When I ask where they come from, they invariably say that they were transferred from some other part of their departmental labyrinths in Ottawa. “Huh?” I say, “and you willingly came here?”
Nope. They have been “surplused” (that’s a fancy word for fired) and given the chance to replace a retiree in the hinterland. All are, of course, going on “HHTs” (house-hunting trips) every weekend, and every single one has their owned house listed back home in Kanata or Barhaven. This has to make an impact.
Unfortunately, they can’t offer any actual insight. When I ask to whom they’re all going to sell, given that everyone seems to be getting laid off up there, they mostly shrug. If they actually lost money on their house, the taxpayer would make them whole. Fair enough.
#38: Thanks for the positivity, a lot of people need a good dose. It truly is a golden age, and the best is yet to come.
#54: Mm-hm, “tax wealth, not income.” Can you think of what kind of a perverse incentive this may lead to?
Number 44 dosouth
Sorry #15 Shawn – your version of a good deal $3800 for a $368k house??? Our last house in the Okanagan we sold in 2012- $680k taxes were $3680. Now accordingly this would be a screamer of a deal…..no?
****************************************
Yeah probably a good deal… Not sure about the job situation in the Okanagan versus Edmonton though…
Anyhow right, man up and pay up. In the end life in 2013 is a sweet deal for most of us.
That Kia is in front of the vehicle whose passenger is taking the photo. Oh the ironing.
Oakville’s hottest band is 600-700K. Well priced and well updated homes are gone fast, usually within several days. Overpriced ones are not moving. Have not seen any May 19th effect yet. Garth, what does your research dept say about Oakville?
Aussie Update
The month of May started with a 25 basis point cut in the official cash rate to 2.75 per cent, the lowest setting in 53 years. Real Estate experts were adamant this would put a pulse back in a directionless market. But rather, we have seen a sharp plunge in MONTHLY home values.
Darwin recorded the largest fall in home prices, down 3.5 per cent for the month. Adelaide followed with a 2.3 per cent decline, Melbourne – home to Ford recorded a 2.1 per cent decline, Canberra 1.3 per cent and Sydney, a 1.0 per cent decline. Only two capital cities had rising prices, Hobart notched up a 2.2 per cent rise and Perth 1.0 per cent.
http://www.abc.net.au/news/2013-06-03/home-prices-drop-steeply-in-may/4729018
http://www.whocrashedtheeconomy.com/blog/2013/06/home-prices-down-sharply-in-the-month-of-may/
#61 Rational Optimist on 06.04.13 at 8:41 am wrote
#54: Mm-hm, “tax wealth, not income.” Can you think of what kind of a perverse incentive this may lead to?
There are two kinds of wealth: man-made wealth and natural wealth. Taxing the former leads to a reduction in its quantity and is therefore a bad thing. Taxing the latter has no effect on its quantity and is therefore not a bad thing.
Property tax is a tax on on both types of wealth because it’s a tax on the value of the building (man-made) and on the value of its location (natural). It would be considerably better if property tax was a tax on the location value alone for then there would be no disincentive to improve the building.
#64 SS — “Well priced and well updated homes are gone fast, usually within several days. Overpriced ones are not moving.”
Not that I’m doubting you, but absent an objective and independent measure of “well priced” this is just a big tautology. Not moving? Must be overpriced. Sold fast? Must’ve been well priced.
It makes me wonder whether sellers are leaving money on the table by pricing for a sale within a week rather than within a month, or even (Heavens!) the old standard of ninety days. Or perhaps buyer expectations have changed so much that a listing at 14 DOM is considered stale and likely somehow blemished?
Frankly, I don’t even know why it should take three days to sell a house. Those super agents on HGTV can do it in 22 minutes! What’s wrong with the rest of you?!?
Good parable:
” How to Catch Wild Pigs”
There was a chemistry professor in a large college that had some exchange students in the class. One day while the class was in the lab, the prof noticed one young man, an exchange student, who kept rubbing his back and stretching as if his back hurt.
The professor asked the young man what was the matter. The student told him he had a bullet lodged in his back. In his native country he had been shot while fighting communists who were trying to overthrow his country’s government and install a new communist regime.
In the midst of his story, he looked at the professor and asked a strange question. He asked:
“Do you know how to catch wild pigs?” The professor thought it was a joke and asked for the punch line. The young man said that it was no joke.
“You catch wild pigs by finding a suitable place in the woods and putting corn on the ground. The pigs find it and begin to come everyday to eat the free corn. When they are used to coming every day, you put a fence down one side of the place where they are used to coming. When they get used to the fence, they begin to eat the corn again and you put up another side of the fence. They get used to that and start to eat again. You continue until you have all four sides of the fence up with a gate in the last side.
The pigs, which are used to the free corn, start to come through the gate to eat that free corn again. You then slam the gate on them and catch the whole herd. Suddenly the wild pigs have lost their freedom.
They run around and around inside the fence, but they are caught. Soon they go back to eating the free corn. They are so used to it that they have forgotten how to forage in the woods for themselves, so they accept their captivity.”
The young man then told the professor that is exactly what he sees happening in America. The government keeps pushing us toward Communism/Socialism and keeps spreading the free corn out in the form of programs such as supplemental income, tax credit for unearned income, tax cuts, tax exemptions, tobacco subsidies, dairy subsidies, payments not to plant crops (CRP), welfare, medicine, drugs, etc. while we continually lose our freedoms, just a little at a time.
One should always remember two truths: There is no such thing as a free lunch and you can never hire someone to provide a service for you cheaper than you can do it yourself.
If you see that all of this wonderful government ‘help’ is a problem confronting the future of democracy in America , you might want to send this on to your friends. If you think the free ride is essential to your way of life, then you will probably delete this email. But God help you when the gate slams shut!
================================
Shawn,
“believe me.”
——————————————–
No….I will not. Your relentless singular perspective eliminates any semblance of balance and thus, any chance at credibility.
The ‘condo’ that sold for 25 million in Van is the top two floors of the Fairmont hotel and has 14 bedrooms. Hardly your average home. It’s practically a hotel in itself.
14 rooms, that is… Not bedrooms!
REITs are going to get punished with the downturn. They have had a great run when the price of housing and commercial rents rise. Thats not happening anymore, hence the sell off.
Its ironic Garth is saying REITs are on sale, while saying the housing market has a long way to go.
What a good Freemason Garth is….
REIT values have nothing to do with residential real estate (how many times do I have to type those words?). You are investing in income-producing commercial properties, most of which have steady cash flow and cut-rate financing in place. The distributions are excellent, and any sell-off is a welcome opportunity to buy assets which are generally not correlated to equity markets. Learn a bit more before you give advice. — Garth
Canada;s real problem
“Our combined income is $274K before tax.
The latest estimate is that 26,800 federal civil service jobs
‘
Millions of Civil servants being paid as if they were successful business persons
#68 Dr. Hoof – Hearted,
nice Republican fairy tale for right wing simpletons.
> From CNNFN
Part of what got us into this mess was the housing bubble. Many Americans were in over their heads, and found they were saddled with underwater mortgages after the bust. Since late 2008, households have been deleveraging. Now, the average American is $46,000 in debt — the lowest level since 2006. About 71% of that debt is tied up in mortgages.
So the US average non-mortgage debt is currently $13K or so, vs. $27K for Canadians? Lovely.
Dr. Hoof – Hearted: How to catch wild pigs. Good story
As the Canadian economy moves at a snails pace, coupled with the overbuilding of commercial RE coming online very soon this is a recipe for disaster. Increased demand for these commercial properties will decrease with the overall economy.
Take a look at the US reits from 2005 till now. They no doubt had a huge bull market, but lost most of their market cap in 2008. How is this any different than Canada?
I would be happy to revisit the price of these reits in a year or two. Please no one get sucked into these value traps. Garth, you trumpet reits while snubbing anyone who wants to buy an investment property. They are one and the same. Buying into a reit at the height of the market, just because they have strong yield is not a good decision. Might as well get your financial advice from Income Property!
The Canadian economy rebounded in Q1 with 2.5% growth, higher than the US. So much for that argument. There is absolutely no overbuilding in the key office space sector in the largest centres such as Toronto. Strike two. All assets in 2008-9 lost value and there was no place to hide, but REITs and preferreds rebounded quickly and continued to provide consistent yield. Strike three. Finally buying a corner 7-11 store for income is completely unlike investing in a quality REIT, or a good Canadian REIT index, due to strong, competent management, preferential financing and diversification. Your fear and attempt at market timing do not serve you well. — Garth
Nowhere does it say that the couple who earns $274k are civil servants. Even if it did, without knowing what they do or how well they do it, how do you know they’re overpaid?
And Hoof, unless you’re worth mid eight figures at least, it’s you who’s being conditioned with your daily ration of corn. If you really want to live in a meritocratic, eat-what-you-kill paradise, may I suggest:
http://www.foreignpolicy.com/failed_states_index_2012_interactive
…and remember, a journey of a thousand miles starts with the totter of a single trotter!
#68 Dr. Hoof – Hearted
“you can never hire someone to provide a service for you cheaper than you can do it yourself.”
——————————
Say!… did you know you anyone can take out their own appendix just using items lying around the house? Its not as hard as it might seem.
Same goes for lobotomy.
Well, this is both alarming and sadly predicted, onthis blog and elsewhere.
The CDC in the U.S. is reporting a massive spike in suicides among Baby Boomers.
“The idea that so many of us in this country have been brought up with — that you work hard, you get your house, you get your American dream, everything is rosy — it hasn’t worked out. A lot of these boomers aren’t going to earn as much money as their parents did. They aren’t going to be as secure as their parents were.”
http://www.thestar.com/news/world/2013/06/04/baby_boomers_are_killing_themselves_at_an_alarming_rate_why.html
So many people are going to be so screwed. Meanwhile, delusional ones are still in bidding wars.
This will not end well, and for many it appears it will end too early.
Derek R at 66 said:
There are two kinds of wealth: man-made wealth and natural wealth. Taxing the former leads to a reduction in its quantity and is therefore a bad thing. Taxing the latter has no effect on its quantity and is therefore not a bad thing.
******************************************
Simplistic and I believe wrong.
Taxing man made wealth would incent less wealth all esle equal. But all else is not equal. You need government and the rule of law and contract enforcement or else your man made wealth will simply be taken from you in a lawless society. And then you would not bother creating it in the first place. A certain amount of taxes are needed to provide that very essential service.
There is little or no natural wealth than can be made useful without the addition of mad made wealth and systems. Unless you favor a hunter-gatherer system, there is no pure natural resource that we use without man made systems. The one exception Ican think of is the air we breath. Everything else that we urban humans consume and use each day I think has man-made systems attached (i.e. water piped to the house).
http://urbantoronto.ca/news/2012/06/torontos-other-development-commercial-projects-under-construction
10 million square feet of office space in the works.
The US is rebounding with a second housing bubble. I thought the first one was bad enough? So much for learning from history. For some who runs this blog about the downfalls of an overheated RE market, you are naive to think the US is growing at any rate. Debt does not fuel growth. The sugar high from all the debt is captivating the US once again. They have the same demographic issues we have. Students with huge debt loads and crappy service jobs, Boomers downsizing, you know the story.
So much for rising interest rates. A half point rise would kill a so called ‘recovery’ in the US. Same with Canada. With rising rates, these Reits are in the same boat as every else.
Mortgage rates are going south, 2.5% will be the next big thing.
Fool me once shame on me, fool me twice, well Greater Fool.
Let’s see where REITs head in the coming years, whats the harm?
Storys of lost poodles who receive in income over one quarter of a million $ a yr. and are frozen in the housing headlights are pathetic on far more than the obvious level. However, claims that central banks are dumbstruck that their machinations create asset bubbles witch need more manipulations to correct are insidious.It boils down to cronies helping cronies, in Canada since the family compact.
The crash in 2008 came about because lowering interest rates and increasing debt eventually did not work.
Since then it has been more of the same, on a global basis, to extremes never seen in human history.
Tapering?
That’s it? Sound like instead of 2 cases of beer every night let’s bring it down by one bottle and make everyone think we have become a recovering alcoholic.
What a joke.
There is still great systemic risk with the instruments used and off balance sheet derivatives. TBTF Banks continue with pathological actions that at most “when caught by regulators” get a slap on the wrist with fines so low there is still enormous profit that only encourage repeat action.
#79 Mister Obvious on 06.04.13 at 11:36 am
#68 Dr. Hoof – Hearted
“you can never hire someone to provide a service for you cheaper than you can do it yourself.”
——————————
Say!… did you know you anyone can take out their own appendix just using items lying around the house? Its not as hard as it might seem.——————————-
he did say cheaper, not better;)
–
#51 Buy? Curious? on 06.04.13 at 4:11 am
Garth, do you get bored at being right all the time?
Check out this little diddy from none other than Dr. Doom, Mr Nouriel Roubini, the second sexiest person in economic blogging (Who’s the first? I’ll give you 3 guesses but the first 2 don’t count). Here he is talking about how gold investments were for scared grey haired dudes that watch Fox, Glen Beck, and vote for crack smoking politicians.
http://www.economonitor.com/blog/2013/06/after-the-gold-rush/?utm_source=contactology&utm_medium=email&utm_campaign=EconoMonitor%20Highlights%3A%20Time%20Travel
Where’s Smoking Man?
Look at the guy on the left of Rob Fords video, that’s Smoking Man perhaps? He just disappeared last week, really missing his camel toe, bat wing Forex excursions into the alter reality of life in Long Branch. Almost bought a house there two weeks ago, great deal only $450K.
#79 Mister Obvious on 06.04.13 at 11:36 am
Same goes for lobotomy.
=================================
I am increasingly convinced, as the anecdotal evidence piles up, that many GF bloggers have attempted self -lobotomies with a high success rate.
For many others, it is redundant, (but give it the old college try !).
#68 Dr. Hoof – Hearted on 06.04.13 at 10:04 am
Good parable:
” How to Catch Wild Pigs”
http://www.youtube.com/watch?v=_GLUqCV-L7A
Great analogy Ive heard it once or twice. Where I grew up you catch them with a 303 right between the eyes. They are fast little buggers and smart as hell!
http://www.youtube.com/watch?v=NTmeHM-Hojg
Wow, interesting crowd here today. First, there’s “you can never hire someone to provide a service for you cheaper than you can do it yourself.”
Now I know some of us are too busy sewing together our own underwear from scratch to keep up with new economic theories, but Adam Smith (Wealth of Nations, 1776) postulated that you often can hire someone to do it cheaper, and that this is the basis of trade. It’s interesting that in modern society, you have to pay that person with after tax dollars, with sales tax on top, and he has to pay income tax on his profits, and it’s often STILL cheaper!
For the advanced class, David Ricardo (Principles of Political Economy and Taxation, 1817) showed that sometimes, it’s worth your while to pay the other guy EVEN IF YOU CAN DO IT FOR LESS YOURSELF, because, in the time it takes you to do it, you could be doing something even more valuable. For the wealthy, this more valuable thing could even be leisure!
Next, everyone give a special round of applause for our guests today, the Georgists! Stuck in the nineteenth century mindset of a mixed agrarian/industrial society with no intellectual property to speak of, these people actually believe that it is possible to run a modern society’s government on land and resource taxes alone. Who’d bother to grow food or mine copper and pay taxes for everyone when he could sit in Starbucks building mobile apps and paying no tax at all (save his share of the coffee chain’s ground rent)?
And finally, from Camp Compromise: “Your relentless singular perspective eliminates any semblance of balance and thus, any chance at credibility.” You just know that this guy thinks the earth is half round and half flat, shaped a bit like a giant toilet paper tube…
Actually there is an organization in Ontario for Seniors called Seniors For Seniors who will do lots of things, but it will cost. Like need someone to buy me an item to deliver, or take me somewhere, or have an old lady come to my residence for the night to watch over me, and the list is long.
#74 Herb on 06.04.13 at 11:02 am
#68 Dr. Hoof – Hearted,
nice Republican fairy tale for right wing simpletons
===================================
Herb…
One of my favourite Leftie parables is the one about the University Grad who came home and started spouting off the typical socialist rhetoric .
After finishing her rant..her Dad said that she should share her good grades with other students….ie that the “B” she has in one course should maybe be a C+… the “A” she received in another course should maybe be a B…etc etc. …..the rest of the grades be lowered and the “surplus” be distributed to others with lower grades.
His daughter took umbrage and said
” NO WAY , why should I SHARE them ? I earned them !!! they are MINE ” .
Here endeth the Leftie lesson
My semi off the Danforth has no termites!
I must really score then!
(Oh, its the asbestos laden Vermiculate insulation in the attic that will get me then!)
About Calgary Real Estate
Contrary to what Calgary Herald reports, the luxury market is really in a bad state. Some of the list prices are down by as much as 20% in a month. I believe that if markets were buoyant the list prices should rise, not fall.
The list prices in the mid-range 300k to 500k market are also going down every week.
In all, approximately 750 out of 3500 owners have reduced their prices. Only a very small fraction (30) have increased the prices.
Also the median list-price is way above the median sale price for the month of may. This means that the sales that occur are well below the list price. (Note: The sale price may still be above the last year’s may sale price. I dont have sale price data).
So there is a chance that the Calgary SFH prices may also see a drop soon.
cheers!
It seems Britain wants to copy Canada; that is stimulate the economy by stimulating the RE industry. Here’s a link:
http://www.businessinsider.com/albert-edwards-blasts-uk-mortgage-subsidy-2013-6
The author thinks the resulting inflated prices will lead to indentured slavery. Garth has been harping on this for some time. Both are right it’s the most destructive aspect of the whole housing mess.
As good as David was… there’s no denying that the other Ricardo more neatly captured the flavour of our times and ushered in a new era of CapitalFormation with his groundbreaking exegesis on Dynamic Stochastic Babalu Equilibrium. I believe he also owned a Leica.
For the VeryAdvancedClass:
http://youtu.be/rAV3bOJaQuY
Intelligent Life found among Blog Dogs!
Yes indeed in Ralph Cramdown at 88 we have a confirmed sighting of some real actual intellect and knowledge. I hesitate to say it but I think that is rare among those who post here. The final part where he defends me from an attacker seemed particularly brilliant.
derek r
…and then there was the supernatural profit AIG
–
#68 Dr. Hoof – Hearted — “The young man then told the professor that is exactly what he sees happening in America. The government keeps pushing us toward Communism/Socialism and keeps spreading the free corn out in the form of programs such as supplemental income, tax credit for unearned income, tax cuts, tax exemptions, tobacco subsidies, dairy subsidies, payments not to plant crops (CRP), welfare, medicine, drugs, etc. while we continually lose our freedoms, just a little at a time.” — Also for Turnernation, shanks, Frizzz, SMan etc.).
Although this link is about a week old, it shows that many other incidents are happening, most of which are never touched on by the paid-for and controlled m$m.
It is well-documented that Soros and frontman Obama admire the Chinese communist way of banking, and it appears that the west is also headed in the same direction, albeit quietly and slowly. Keep on snorting like the good little pigs we all are!
Report from Vancouver
http://www.rebgv.org/sites/default/files/REBGV%20Stats%20Package_May%202013.pdf
some quick numbers out of the Okanagan
source: Kelowna Daily Courier
‘The 2012 check up [] showed:
– 2,000 jobs were created in the region last year, almost enough to make up for the number of jobs lost in 2011.
– The job growth rate of 0.8 per cent in 2012 was below the provincial rate of 1.7 per cent.
– The service sector was responsible for most of the job growth with increases in finance, insurance, real estate, leasing and professional, scientific and technical services.
– The jobless rate in the region in 2012 was 6.9 per cent, down from the peak of 8.8 per cent in 2009.
– The value of building permits in the region dropped almost 25 per cent because of soft capital investment and infrastructure project construction.
– The number and value of new projects proposed dropped 54.8 per cent.
– The number and value of projects starting construction was off 72.3 per cent.
– At the end of 2012, the total value of projects proposed, under construction or on hold totalled $25.2 billion, a six-year low.’
#99 REBGV numbers. 2800 sales in May? I thought the pre report numbers stated here by some poster was about half that and a decline of 45%?
Something doesn’t add up.
#57 Herb. Appreciate the link. Thanks for ruining my lunch. No, seriously thank you.
How is .gov going to get funded in a zero growth global economy with declining demographics? Same funding as the USSR applied. Pay their .gov service employees with toilet paper. See black markets sprouting up where the real goods are sold for real currency.
Deflation, deleveraging and a substantial reduction of .gov, bennies and liabilities is NOT going to happen.
Farmers are going to do just fine when .gov inflates away.
TD predicts a very soft landing for big cities like Toronto and Vancouver. Growth in Calgary, Edmonton & Sask:
http://www.bnn.ca/News/2013/6/4/Housing-slowdown-to-be-felt-most-in-big-cities-TD.aspx
#89 Ralph Cramdown on 06.04.13 at 12:57 pm
Have you viewed the ” Iron Mountain” documentary ?
I don’t agree with all of it, nor do I expect others to…. but the first part is very intriguing on the economic model transference.
Soft, gentle, balanced…
You’re in agreement right Garth?
#27 [email protected]
“this is the same mortgage insurer that will approve a McDonalds burger flipper who has a job for 6 months at 5% downpayment.”
Worst things are happening to keep the market pumped up, heard from Brampton that one guy got approved for a 300 k mortgage at 2.74 for 5 years, his annual income is just 33 k.
I got my pre approval from TD last week, 2.79 for five year fixed, but nothing much in the market for our budget, will be out this weekend looking at some properties.
#98 Nosty the Pariah — “It is well-documented that Soros and frontman Obama admire the Chinese communist way of […]”
Maybe there’s places on the ‘net where ANY sentence containing this holds sway, but they must be dark corners indeed. Given Soros’ past, it is highly unlikely that he admires anything about the Chinese communist way of anything. Given Obama’s history, path to power and base of support (financial and voting), it’s fairly unlikely he’s beholden to a billionaire hedge fund manager. Wait… Didn’t he DEFEAT a billionaire hedge fund manager?
It’s OK, you don’t have to be right politically; you just have to be right as far as politics affects your trades. Has Obama wrecked the economy, as evidenced by your brokerage statement? No? Maybe all you’ve got to bring to the table is an ISP bill… Not his fault you’re up late every night watching doomer porn!
#89 Ralph Cramdown
Next, everyone give a special round of applause for our guests today, the Georgists!
================================
Encore Encore
http://www.youtube.com/watch?v=tUxCCFfFIEw
#101 REBGV; it shows you that they are so reliable and ethical about telling the truth… “NOT”
There is no accountability on behalf of the Real Estate Board.
Which is so wrong as most people believe they are ethical and wouldn’t embellish numbers for their own agenda.
#93 Worldview said:
“Contrary to what Calgary Herald reports, the luxury market is really in a bad state.”
I’m not sure where you get your info from? Maybe you should read this article.
http://blogs.calgaryherald.com/2013/05/30/may-a-record-month-for-calgary-real-estate/
And what is happening in Calgary?
The prevailing mentality here among many people is that they actually are deluded into believing that their $180K shack is worth $500K, as this is what the current market will support. I will admit that I was forced into this market for one very solid reason: Rents in Calgary are the same as a mortgage. So only an idiot would rent if they need the leverage to get out of this claustrophobic most of the time frozen hell hole town that is convinced it is a city. Unlike Houston Texas, the farmers line supports a stoppage of city growth, and the City and government dont support turning places like Nose Hill Park into places for housing, as they should. So many renters such as myself were scrambling for around five years to save and find a decent place logistically. There was no talk about “investment”, “return” and blah blah blah that so many adults use to make themselves feel important and special when no one is important or special. No one. All people use the washroom and go number 1, and number 2. The last time I checked, housing prices havent changed really that much from 2007 until now, so unless you have upward mobility and or no job, it makes sense to get your own place in this frozen hell. Why would anyone in their correct mind support the landlord scum that are profiting off of the hostage audience? Do the math: Say $1500/month rent that is over $15,000 a year in free cash to some scum sucking landlord. Seems to me it makes more sense to take the risk looking at the prevailing trends in Calgary. As much as I would like housing to be $180K for a 2500 sq. footer, I dont see that happening unless interest rates go to 15%, and in which case I would likely lose my job.
The Calgary Housing market is one of anxiety, deception, and nausea. The timing in Calgary is nuts: Wait, wait, and wait forever and be prepared to strike like lightning if you see a place you can afford. Watch, and be ready at all times if you are a renter all the while honing your skills at negotiations with the older slower crowd in Calgary who need about 3 seconds to depress the gas pedal at lights that just turned green. You need to be faster and stronger than them. I was and continue to get stronger and smarter day by day dealing with the older people, it is a waiting game…..
Stan,
“Intelligent Life found among Blog Dogs!”
“I hesitate to say it but I think that is rare among those who post here.”
————————————————————-
Good plan Stan, insult the whole blog.
More narrowness of mind.
You must feel special.
Are you special, Stan?
http://natpo.st/10O4BHa
I’m back, hope you all enjoyed the break.
So you think rates are going up anytime soon.
Not till above Link reverses trend…
I think they are going down.
fee suckers & shadow docket ..HSBC brazenly ignoring state law …no kidding !
“The bank continued to charge interest, fees and other penalties for as long as two years in some cases before it filed the required document.”
Read more: http://www.nasdaq.com/article/update-new-york-attorney-general-sues-hsbc-over-foreclosure-filings-20130604-00944#ixzz2VHRsX6NL
==
the new mergers ?
two hats paid as one
“The Chicago Sun-Times is training its journalists in iPhone camera work to replace its staff photographers, who were all laid off last week.
===========
A charity that was advertised as a way to “improve the lives of young children and adults, the Cup Trust was a front for a multimillion-pound tax-avoidance scheme.
donated just £55,000 out of £176m income to charitable causes. Despite its scant donations, the trust used a complex web of transactions to seek £46m in gift aid, and its “donors” claimed £55m in charitable-giving tax relief
http://www.guardian.co.uk/politics/2013/jun/04/cup-trust-charity-watchdog-tax-avoidance
#109 Uwinsome
Yes, we always believe what house pumper Mario Toneguzzi writes.
Dude, get your head out of your
Garth has it been you calling for the so called US housing rebound. Not according to these facts.
2nd HOUSING Bubble POP! MASS LAYOFFS For Mortgage Bankers
June 4th, 2013
1 1 0 0 5
The conclusion: the second housing bubble may have already popped…The following comment from Mark Hanson should pour cold water on anyone who still harbors any delusion that there is a “housing recovery” or that any transitory, cheap-credit driven price hikes, will persist.
Mass Layoffs in Mortgage Space
Large scale, sudden mortgage finance job loss on deck…will impact weekly claims. Rates a stiff headwind to house prices, bank earnings, consumer spend, home improvement et al.
After 5 years of interest rates being forced incrementally lower each year — and everybody that qualifies refinancing over and over again allowing the banks to originate and earn several points off of each gov’t loan churn — the jig is up for a while at least. The mortgage market is now so efficient — and rates have been at historic lows for so long – there is simply nobody on the proverbial “fence”.
This morning I was made aware that three large private mortgage bankers I follow closely for trends in mortgage finance ALL had mass layoffs last Friday and yesterday to the tune of 25% to 50% of their operations staff (intake, processing, underwriting, document drawing, funding, post-closing). This obviously means that my reports of refi apps being down 65% to 90% in the past 3 weeks are far more accurate than the lagging MBA index, which is likely on its’ way to print multi-year lows in the next month.
As I stress in the note below, the “refi capital conveyor belt” is a quiet, yet powerful economic driver. Not only do refi’s grease homeowners balance sheets and have been responsible for the lions” share of mortgage-centric US banks’ earnings over the past few years but they are huge for the labor market.
With respect to jobs, well over 100 individuals touch one refi from loan application printing/shipping, up-front processing (appraisal, credit, bank/job verifications, title, escrow etc), to lender underwriting, document drawing, and funding, and through post-closing including securitization and trustee services. So when the refi door slams shut it’s a macro headwind for which few account. In fact, many model the exact opposite…that rising rates is great for banks and the economy.
Vancouver Market Inventory
http://whispersfromtheedgeoftherainforest.blogspot.ca/
Jan. 2, 2013: 11,789
Feb. 1, 2013: 13,930 (+2,141)
March 1, 2013: 15,466 (+1,536)
April 2, 2013: 16,236 (+770)
May 1, 2013: 17,471 (+1,235)
May 2, 2013: 17,522
May 3, 2013: 17,616
May 6, 2013: 17,727
May 7, 2013: 17,787
May 8, 2013: 17,833
May 9, 2013: 17,935
May 10, 2013: 18,050
May 13, 2013: 18,093
May 14, 2013: 18,180
May 15, 2013: 18,163
May 16, 2013: 18,140
May 17, 2013: 18,214
May 20, 2013: Victoria Day
May 21, 2013: 18,326
May 22, 2013: 18,315
May 23, 2013: 18,353
May 24, 2013: 18,399
May 27, 2013: 18,414
May 28, 2013: 18,353
May 29, 2013: 18,422
May 30, 2013: 18,446
May 31, 2013: 18,332 (+975 so far this month)
New Listings 186
Price Changes 124
Sold Listings 129
Expired/Cancelled: -67
QUOTES:
1. There are less buyers for more expensive single family homes and relatively more for attached properties;
2. Many of the frustrated listings are ones that have been purchased since 2010 and had high original purchase prices. Those sellers can’t bring themselves to realize a loss. Hence the stagnant listings, expireds and terminateds. They live off hope of a turnaround.
—-Once sellers get it in their heads that their properties are only worth what buyers will pay regardless of what they paid for their properties, the ratio will start to descend further. I believe that time is coming although it will take time for the required volume of sales to diminish the outstanding inventory.
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I don’t foresee a rate hike…for the reason that it may force too many people under, flood the market, compound/exacerbate the problem.
Funny how the magic number rof 20,000 is avoided
#114 JSS
You can dispute prices of the real estate boards Frankenumbers. But a fact is a fact on the numbers of places changing hands – “the month had the highest level ever for luxury home sales of properties more than $1 million, according to Mike Fotiou, associate broker with First Place Realty in Calgary. There were 84 luxury home sales in May, besting the record for any month which was previously 80 in May 2012.”
You can read more here:
http://www.calgaryherald.com/business/Calgary+housing+market+smashes+records/8470127/story.html
But maybe you’d rather hold onto your conspiracy theories.
Dr Mr Uwinsome
see above post #116
that is where Calgary is headed – no conspiracy
#106 Ralph Cramdown — Yawn, sputter, snoooozzzzzeeee.
#38 Shawn on 06.04.13 at 12:27 am
GOVERNMENT and Taxes
Dr. Hoof-Hearted at 23 said to me:
Not sure your point
Is it Bend Over and leave the driving to Gov’t ?
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No, my point was that my taxes went up 3% per year on average for 18 years while property assessment went up 6.4% per year on average.
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Well said, if nobody paid taxes we would have nothing like the life and amenities we have now. I know too many business people that pay no or very little in the way of taxes….They use the roads, hospitals, schools like everybody else. I too am grateful for all we have here in Canada….Politicians could use a little tuning up but I suppose that is everywhere.
Sales of Fraser Valley homes slow, prices stable, listings slightly down:
http://www.vancouversun.com/business/mortgages/Fraser+Valley+home+sales+slowest+pace+since+2001/8477154/story.html
Love this story.
http://www.thestar.com/news/gta/2013/06/03/habitat_for_humanity_canada_survey_shows_affordable_home_ownership_contributes_to_healthier_happier_families.html
Now its healthier to own a home and kids get better grades than renters. Like wth they used to live in an old badly insulated apartment and deserve a paid by taxpayers newly built home with a mortgage payment of only 30% their household income.
Where can I sign up for this deal? Lemmie see, I live in an old badly insulated apartment and if I was to buy a house today hmm I’d have a mortgage 80% of my income.
BMO alleged the fraudsters would buy low-end homes in nice neighbourhoods and later convince the bank that the property was worth more than the purchase price. The alleged fraudsters would sell the homes at inflated values to immigrants to whom they gave documents that falsified their incomes.
http://www.theglobeandmail.com/report-on-business/industry-news/the-law-page/bmo-settles-mortgage-lawsuits/article12348043/
#50 W
Waterloo resident
June 6 will be the unveiling of the new Corolla. It is supposed to have a new CVT transmission that will get outstanding fuel economy. I drive a 2006 model and i bought it used because the 2010 Corollas were just AWFUL: worse steering and far-worse braking than the older 05-08 models ! I hope Toyota fixes all this with the new 2014, or else the new KIA Forte EX, with the 180 hp 2.0 L engine will eat Toyota Alive !
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My wife had a 2010 Kia Forte with a 184 hp motor (loaded model with leather etc…) The car was a rocket-ship acceleration wise but got horrible mileage and the 5 speed automatic hunted all the time, just touch the accelerator and it starts downshifting whether you want it to or not. They have some good ideas but quality is not there yet…..Slam the doors or trunk.
#89 Ralph: “Wow, interesting crowd here today. First, there’s “you can never hire someone to provide a service for you cheaper than you can do it yourself.”
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Hmmm…..
Well, I know my dad always used to say: “If you want a job done RIGHT you have to do it yourself.” :-)
You buy a house and 10 years after you are rich. What kind of society accept that? Morons ?
In the Fraser Valley of Greater Vancouver, lots renter renting $1100 for 2 bedroom apartment asking $240K or 2 suites detached total $2850 asking $750K. It results in 18 to 22 years of Price to Rent Ratio. Can’t see housing prices dropping much. Rent ALWAYS go up for the last 33 years that I can remember… like property taxes.
# 89 Ralphie Baby….
I understand yer point, but one has to realize that the current economic model is inherently corrupt, wasteful and inefficient by design.
There are so many useless professions/professionals that would disappear tomorrow if the public ever woke up.
PS..hope you had luck sewing up yer gonchies….think of all the reduced environmental impact
#120 Oceanside on 06.04.13 at 6:37 pm
Well said, if nobody paid taxes we would have nothing like the life and amenities we have now. I know too many business people that pay no or very little in the way of taxes….They use the roads, hospitals, schools like everybody else. I too am grateful for all we have here in Canada….Politicians could use a little tuning up but I suppose that is everywhere.
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To Chiropractor:
Make that TWO appointments
Prices may not have fallen overall in the Toronto markets but TREBs own numbers show the brewing storm.
The supply of condos in downtown (C01) has increased 120% year over year while sales slipped 18%. Completely unsustainable. Even if the fools don’t fall into the open condo construction pits that line the streets.