Stagnant, expired & terminated

shark

My, my, my. Spin, spin, spin. What an interesting world we inhabit.

This week real estate boards (some of them, anyway) announced May stats they said showed markets had bounced off lows and are in recovery mode. But nothing could be further from the truth. In Toronto, condo sales have fallen by a fifth in the last year and a half while listings have grown 120%. It’s a Hindenburg moment. Three-million dollar estates in North Toronto that sold in hours a year ago now sit for months. Fewer buyers chase fewer listings, and in a narrowing price band. Things are about as healthy as, oh, the mayor.

And a Vancouver comeback as some faux economists there are predicting? Pshaw. Sales are running 19.4% below the ten-year average, and even the realtors’ Frankenumber is showing a loss. Detached sales were down 22% from last May. As Richmond realtor Arnold Schchat told clients the other day:

“There are less buyers for more expensive single family homes and relatively more for attached properties; 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, expired and terminateds. They live off hope of a turnaround.”

Nope, May did not bring the reset that realtors hoped for, which won’t stop them from lying about it.

“The sales picture in the GTA has improved markedly over the past two months,” says TREB boss Ann Hannah. “While the number of transactions in April and May remained below last year’s levels, the rate of decline has been much smaller. A growing number of households who put their decision to purchase on hold as a result of stricter lending guidelines are starting to become active again in the ownership market.” Of course, there is nothing to substantiate that claim.

Meanwhile in Van: “We’ve seen some steadying trends over the last three months,” says REBGV president Sandra Wyant. “The number of homes listed for sale has been keeping pace with the number of property sales, leading to a balanced sales-to-listings ratio. This is having a stabilizing influence on home price activity.” But, of course, prices have gone down, with her creds.

The danger here? That more hapless property virgins will be sucked into the Vortex of Horniness just in time for a far more serious decline. Or that idiot Boomers will put off selling, ‘until things get even better’, and end up addicted to Milkbones. As I mentioned here yesterday, Canada has been singled out by the OECD (and The Economist, for that matter) for having one of the world’s most dangerous housing gasbags, utterly fueled by cheap money and swelling debt.

And on that note, here’s the latest bulletin sent to realtors yesterday by the nice mortgage executive at Scotiabank:

FYI- Rates are to increase 10bps on the 5 year to 2.99% as of Friday.  Any clients needing a pre-approval please have them contact me asap.  TD and RBC have already increased as of June 4th.  Also, if you provide clients name and number I can rate hold for 30 days and then submit pre-approval at the end of the 30days allowing an additional 120 day rate hold………… Thanks and enjoy your afternoon!.

Remember what I told you about rate creep? There’s no need for the Bank of Canada to jack up its trendsetting rate in order for the cost of mortgages to gently and persistently increase. But while we’re on the subject of the Big Bank, did you catch the first statements made in Ottawa this week by the new dude, Stephen Poloz?

“As the world heals, interest rates will rise,” Poloz, 57, said during testimony to the House of Commons Finance Committee in Ottawa today, his first remarks since starting the job June 3. “It will be consistent with our inflation target, which is to get inflation back up to 2 percent.”

Poloz said he’s concerned about the risks of younger families in particular taking on too much debt. “That is exactly what the policy is about, low for hopefully not too long gives you the outcomes you need to get through this crisis, and then as the world unfolds we get back to normal.” (Bloomberg)

“Normal” is five-year mortgages between 6% and 8%. Just imagine that that would do to the current housing market, where fools have loaded up on 2.89% mortgages they can barely carry on houses bought at history’s high water mark. When home loans taken in 2011 and 2012 renew in 2016 and 2017, you will understand why real estate is not a financial strategy.

Hell, it already isn’t in Kelowna, the cleavage of the Okanagan.

In two weeks an $8 million dollar extreme house (which can’t sell) goes on the auction block in a rare no-reserve-bid event. Says our correspondent, Dave:

Built in a gated ‘hood I have watched since it was just a bunch of steep hilly lots. One other house there started at 6+ million, and is now on the market at roughly half price, still vacant. This one, I am told is appraised at 7+ million. Obviously, they just took the square footage of the main and pool house and multiplied by 1,000.

I was considering going to this auction, but, it is more house than we would like in retirement, even if it is beautiful. There is a registration process to “get a bid paddle”, it includes; filling out an application asking some banking information, I found this and a few other questions a little too invasive. Also, a $250,000 cheque is required to be posted to bid. I guess that keeps out the riff raff.

Imagine if you built a waterfront palace in the doldrums of 2012, furnished it with 100 pieces of designer stuff, built in the latest technology, stuffed it with Wolfe, Miele and Sub Zero appliances, six-foot TVs, 5,000 feet of patio, Zen garden and infinity pool, underground wine cave tunnelled into bedrock plus a utility house bigger and sexier than most Vancouver homes.

And then nobody wanted it.

“I bet the owner is sweating,” says Dave.

158 comments ↓

#1 Why my stats for May do not match TREB's number on 06.06.13 at 8:53 pm

am writing thing article because someone quoted my stats for May in the Personal Finance forum hosted by RedFlagDeals. Some out of work and out of her mind real estate agent jumped on those numbers like a pitbull and decided to put them down at any cost.

Looking at her efforts to shit on somebody else’s work you wonder if she has anything better to do with her life, especially these days when the sales are not fantastic and the real pray (the buyers) is rare.
Anyway go and read yourself what she had to say and what emanated from her mind. Her comments can be found here,here and here.

As a result of her actions some of my readers asked me if I can provide details or raw data so they can verify the correctness of my numbers and now I have to spend some of my time to explain them.

Since this is voluntary work it will be for the first and last time when I give such explanations. After all I don’t have to and I don’t care if you want to trust me or some Real Estate Agent out of work and after your money.

http://recharts.blogspot.ca/2013/06/why-my-may-numbers-do-not-match-trebs.html

#2 Victoria Real Estate Update on 06.06.13 at 8:54 pm

The average price and median price of properties across Greater Victoria dropped in May. A clear downward trend has been established for an extended period of time. The Teranet – National Bank House Price Index confirms this downward trend in house prices.

The Teranet index shows that Greater Victoria house prices have declined -8.3% from the peak, which was in the summer of 2010. Another -3.3% drop and prices will be at a level not seen since May 2007. Another -2.7% drop after that and prices will be at 2006 levels.

There is absolutely no good reason to buy a house in Victoria right now. Prices are falling. Let them. Many of our friends bought houses near the peak and have since regretted their actions. They are angry at their realtors who told them it was a good time to buy. It is always a good time to buy, according to realtors, real estate boards, brokers and most of the media. Don’t buy into that. Too many families in the US did and have been facing financial peril for the better part of a decade.

Canada is currently in a bigger real estate bubble than the US was in 2006 (see chart). This chart shows that there was house price parity between Canada and the US until 2006. The US market started to crash that year while the Canadian market was boosted by a major intervention and another in 2009 that pushed prices much further into bubble territory.

There has never been a better time to not buy a house in Victoria. You will save far more money than you think by letting the housing market correct. For example, let’s say that a house is valued at $500 K today. If you buy that house after it declines in price by $100 K, you actually save about $300 K overall, since you normally end up paying about 2.5 to 3 times the purchase price over the 25 years it takes to pay off your mortgage.

Imagine the financial devastation that millions of US families have gone through after having bought a house at the wrong time. National housing bubbles always burst and correct back the same amount. There has never been an exception to this.

This Seattle house lost 62% of its value from November 2007 to February 2012. Overall, house prices in Seattle increased by a factor of 1.9 times the long term average as the bubble formed in the US. In contrast, house prices in Victoria more than doubled as the price run-up reached 2.47 times the long term average. If a house in Seattle could lose that much value, then imagine how much houses in Victoria could potentially drop in price.

Girls and guys, I know how much you want that house right now. As a girl in her 20s, I completely understand how you feel. If you buy now you will regret it. Prices will continue to fall. Wait another 18 to 24 months and then take another look at prices. Renting for now is a no-brainer.

Until next time – Cheers!

#3 JSS on 06.06.13 at 8:59 pm

Garth – will rising mortgage rates help the big five canadian banks profitability? Based on the TSX these days, canadian banks look horrible (as an investment)

#4 Babblemaster on 06.06.13 at 9:00 pm

“Normal” is five-year mortgages between 6% and 8%. Just imagine that that would do to the current housing market, where fools have loaded up on 2.89% mortgages they can barely carry on houses bought at history’s high water mark.

—————–

Would love to see that happen, but it won’t.

#5 T.O. & GTA bidding wars debunked June 06 on 06.06.13 at 9:00 pm

http://recharts.blogspot.ca/2013/06/to-sfd-bidding-wars-debunked-june-06.html

http://recharts.blogspot.ca/2013/06/gta-sfd-bidding-wars-debunked-june-06.html

#6 Robbie on 06.06.13 at 9:00 pm

Garth, as Realtors are wont to say, “It’s always a good time to buy!” :>)

#7 Gunboat denier on 06.06.13 at 9:08 pm

There is nothing wrong with milkbones, though they are a little dry.

Woof

#8 George on 06.06.13 at 9:10 pm

Harper’s office treats MPs like ‘trained seals’: ex-Tory MP

#9 Bob Copeland on 06.06.13 at 9:14 pm

I just low balled a condo here in the u.s.. $40k below asking and they accepted. The seller is a builder. He just contacted me asking if we could change the offer by increasing it $20k and show a cash credit for it so my price stays the same. However it would keep the value up for the neighborhood. I wonder how often this happens? Everything in the states is nothing more then a big scam. You cannot believe anything.

#10 I'm stupid on 06.06.13 at 9:16 pm

Hi Garth

Have you considered trying to track the divorce rate, since money is the main cause of divorces?

#11 peter on 06.06.13 at 9:16 pm

Victoria’s VREB.ca stats don’t look too bad. Condo’s are actually up in price vs last May. Go figure. http://www.vreb.org/mls_statistics/current_statistics.html
I’ve been waiting and expecting a decline for years but it just doesn’t seem to happen. Maybe some day.

#12 Bobby on 06.06.13 at 9:16 pm

I’m looking for a new house in Victoria. Many of the homes have been on the market forever, nothing is moving. Many are sitting empty.
There is a glut of homes in the 1-1.5 million range that are not moving.
Who will give in first, buyers or sellers.
It will be fun to watch.

#13 Smoking Man on 06.06.13 at 9:19 pm

Rates are not going up, another bond rally on the way, over night rate prozac controls not will go down to Boost exports by driving dollar down. Sales down prices steady.

Who cares we have bigger problems, mcgoofy broke the law, spent billions wasting our money, the flying nun who took over, is no better.

Kids are getting raped, spat on, faces shoved in shut by auto insurance with the blessing of the libs and cons.

And the papers, let’s find the crack house.

This province sucks…..

#14 Freedom First on 06.06.13 at 9:20 pm

…….which won’t stop them from lying about it. Thank you once again for writing the truth Garth:) ……The RE boards elite, the Brad Lambs and Sherry Coopers of the world…….no one is able to stay in the darkness of deceit without Garth exposing their lies. Garth, may you live a happy and prosperous life and know that you are making many more friends than enemies. I detest the unethical people among us. The “money” before morals crowd. They will never know the feeling of having a life well lived. Priceless.

#15 Sunny on 06.06.13 at 9:22 pm

Garth. You are wrong or lying. On the ground level Toronto is suffering from multiple bidding and ever escalating prices. There is no hype from real estate boards. No market is collapsing. The bastards are right. You are wrong. Wishful thinking!

#16 Dean Mason on 06.06.13 at 9:25 pm

The 17 year artificial real estate boom sustained by speculators, excessive debt, 7% point cut in variable mortgage rates and 5 year fixed rate mortgages is over.The more they try to drag this out,the more painful it will be.The 10% or so normal correction every 5-6 years is going to happen now at 3 to 4 times in magnitude.

This is why we will see a minimum 30% to 40% decline in Canadian housing prices over the next 3-5 years.It will be gradual but noticeable when it’s all said and done.

#17 *NAKED APE* on 06.06.13 at 9:28 pm

Took a look at the video plus one other clip at some desert-looking location. Opulence and grandeur bar none! Bought myself the town Party Platz in the early nineties. Fixed it up – sweet little energy efficient jubie now and have been mortgage free for some time. No G&SS – don’t ‘need’ it!

Just wondering how the people on the other side of the planet are doing – burning dung for heat to cook their food and living in grass shacks. No broken down 60 inch plasma TVs and Hummers that require a brake job to worry about. Probably sleeping better than many Canadians these days.

As a species, we have truly lost our way and it’s only a matter of time before we self-destruct…..

#18 island boy on 06.06.13 at 9:29 pm

The two most exciting times on the Van.Island are
1. Buying your first home there.
2. Selling it and leaving Canada for good.
3. Listening to the “whiners” who stay.

#19 A Nightmare on Bay Street on 06.06.13 at 9:38 pm

Your crawl technique is very good, Garth.

#20 Nemesis on 06.06.13 at 9:40 pm

“Pshaw.” – Hon. GT

You never cease to astonish and entertain, OldPol.

For the briefest of moments I almost thought I was visiting the ReformClub again.

Personally, I vastly prefer the UnionJack in SE1. I get a discount there, you know. No dancers, unfortunately… but if you like WomenInUniform…

#21 TurnerNation on 06.06.13 at 9:44 pm

“Stagnant, expired & terminated”

What is the current CONservative party & senate?

I’ll take Famous Mayors for $200, Alex.

#22 Sparky55 on 06.06.13 at 9:57 pm

@ “#9 Bob Copeland on 06.06.13 at 9:14 pm

I just low balled a condo here in the u.s.. $40k below asking and they accepted. The seller is a builder. He just contacted me asking if we could change the offer by increasing it $20k and show a cash credit for it so my price stays the same. However it would keep the value up for the neighborhood. I wonder how often this happens? Everything in the states is nothing more then a big scam. You cannot believe anything.”

—————————————————

Another big problem with that is your assessment will be $20K higher, so you will be paying yearly property taxes on that $20k…

#23 Smoking Man on 06.06.13 at 9:58 pm

Our new premier got up to the mike and said those dreaded two words that send goose bumps up my spine. words teachers use to stifle creativity, words of control, words that keep the young from realizing there potential.

Inappropriate Behavior.

For you flying nun……

http://www.youtube.com/watch?v=mzXkbJwrN38

#24 DJB on 06.06.13 at 9:58 pm

It is a nice House though… To bad it is in Kelowna. Awful town.

#25 Canadian Watchdog on 06.06.13 at 10:01 pm

This is trending big time.

Washington Post: U.S. mining data from 9 leading Internet firms; companies deny knowledge

Forbes: U.S. Senators: NSA Cellphone Spying Has Gone On 'For Years'

Bloomberg: Tech Giants, Like Telecoms, Have Been Sharing With the NSA

Now, according to presentation slides obtained by the two newspapers, it appears that Microsoft, Yahoo!, Google, Facebook, PalTalk, AOL, Skype, YouTube, and Apple have allowed the NSA to tap directly into their servers in order to harvest user data and monitor individuals over time.

Now you know why those nutbar Tea Pary people were warning about, because when a government can collect all your personal data, family and all,  it's already a totalitarian state.

#26 T.O. Bubble Boy on 06.06.13 at 10:05 pm

@ #15 Sunny on 06.06.13 at 9:22 pm
Garth. You are wrong or lying. On the ground level Toronto is suffering from multiple bidding and ever escalating prices. There is no hype from real estate boards. No market is collapsing. The bastards are right. You are wrong. Wishful thinking!
_________________________

SFHs in the 416 are definitely still seeing bidding wars, especially those under the magical $1M price point (where buyers still qualify for a CMHC-backed loan).

However, head out to places like Mississauga, and you’ll see entire neighbourhoods littered with For Sale signs… Lorne Park (high end Mississauga burb) reminds me of Victoria B.C. these days.

#27 Chickenlittle on 06.06.13 at 10:06 pm

#13 Smoking Man
“Who cares we have bigger problems, mcgoofy broke the law, spent billions wasting our money, the flying nun who took over, is no better.”

VERY funny and VERY accurate! It makes me laugh when they bring up the $90k Duffy got and yet conveniently forget they wasted billions of dollars.

#17 Naked Ape:

So true! We are now officially some of the most useless people who ever lived. We really do not know anything in spite of what our “obedience certificate” says. We know how to let someone tell us what to do and for how long.
I just shoved my beak up some butts this week looking for a new job. It is so degrading! I hate it.

#28 Sexy dex on 06.06.13 at 10:07 pm

AMEX just let go 420 staff in Markham Ontario

#29 Sparky55 on 06.06.13 at 10:07 pm

This is a strange listing.

– It was listed several times in 2011 and 2012 (I have the cut-sheets of it)
– It was taken off the market, and I noticed it up for a private sale. Went looking to see if it was the same one, and it’s history was erased!!!
– It went for sale this year for significantly less, and sold last month.
– Today, again, it is listed as sold!!!
No doubt it was counted in the stats as another sale.

http://www.viewpoint.ca/property/cutsheet/41375825?no-nav=1&no-footer=1

#30 Smoking Man on 06.06.13 at 10:27 pm

#27 Chickenlittle on 06.06.13 at 10:06 pm

Good for you, Make sure you take the customer list when you leave, steal the clients or sell the list, f-em.

The pic reminds me of my sons wedding this past weekend.

I charted 3 buses to take the drunks back to the hotel.
Riding on the buses, the newvo rich, family members.

They are not talking to us…..at the moment

I had a driver take me and wife back in a limo, spent enough on bride and groom , I put then on the bus

I’m not ridding in a school bus with no air.

Needless to say, the groom, my first born asks the driver to pull over he needs to take a leak…..

It was a perfect wedding up to that point, I guess kilts were also a bad idea.

Amazing how the inside of the wind shield got washed.

anyway me and wifey back on the family shit list.

I love it…… what is wrong with me…I am proud of my son……

#31 Math Teacher on 06.06.13 at 10:30 pm

#23 Smoking Man on 06.06.13 at 9:58 pm
…words teachers use to stifle creativity, words of control, words that keep the young from realizing there potential.

Why all the teacher hatred? I’m a teacher and I don’t think I have “words of control”. Sure, there are rules in school, but the objective is to teach students material that can help benefit society.

Sure, most students won’t use very much of their subject specific knowledge in a practical way, but there are the few – the intelligent and creative, that will use their knowledge learned in school and build on it to offer services and create new products and companies that will benefit society.

#32 PokerCat on 06.06.13 at 10:43 pm

Garth said: “Things are about as healthy as, oh, the mayor.”

Ah, Rob Ford. He makes me pine for the pomp and class of the Mel Lastman days…

#33 Christopher Lackey on 06.06.13 at 10:54 pm

It looks like “sell in may and go away” was true this year as the US retreats from its high water mark. Temporary set back or shape of things to come?
Meanwhile anyone who had the jam to go in on Barrick, Kinross, Osisko or Yamana three weeks ago is up 10-20%.
In general I’ve noticed when the talking heads are in awe of all time highs it’s time to take your money and not be greedy, and when they can’t stop talking about how bad it is you should be scooping up as much as you can. See RIM Sept 2012, or the miner examples I just gave.

As for this real estate train wreck, I’d like a house, but if this is what its like in may (desperate realtors, increasingly irrational frankenumbers) imagine November

Having said that I have heard anecdotally of bidding wars continuing in toronto – what say you, Mr Turner?

#34 Stupesing in Cabbagetown on 06.06.13 at 10:55 pm

From the Motley Fool: http://www.fool.ca/2013/06/06/a-brewing-canadian-crisis-and-what-americans-learned-about-bubbles/

#35 Smoking Man on 06.06.13 at 10:57 pm

#30 Math Teacher on 06.06.13 at 10:30 pm
#23 Smoking Man on 06.06.13 at 9:58 pm
…words teachers use to stifle creativity, words of control, words that keep the young from realizing there potential.

Why all the teacher hatred? I’m a teacher and I don’t think I have “words of control”. Sure, there are rules in school, but the objective is to teach students material that can help benefit society.

Sure, most students won’t use very much of their subject specific knowledge in a practical way, but there are the few – the intelligent and creative, that will use their knowledge learned in school and build on it to offer services and create new products and companies that will benefit society.
……………………………………………

Is that what you believe you are doing, then why are you marking them, judging them. That’s not teaching, that’s segregating, and controlling. The idiot fish that can’t climb a tree gets a D.

Please, you take marking and judging out of the equation your my best friend, but you can’t you will lose your job, your roll is not to make smart people who dream and create and build, You destroy the individual for a happy dog that fits into collectivism.

Your job is to make obedient little yes men , who are afraid to challenge your position of authority, which carries into the working life.

Slaves for corporations. Dogs that wag tails, and lick balls.

With what ever obidiance certificate you proudly display, you are nothing but an unknowing spoke in the machine doing its job….

Fail

#36 FTP - First Time Poster on 06.06.13 at 11:25 pm

Watching Global (aka: The Shaw Matrix) this evening. Anyone see Lisa Raitt blabbing…” well I beat Garth Turner, so I guess you reap what you sow…” I thought her head would start spinning, it was quite funny.

#37 Gord In Vancouver on 06.06.13 at 11:37 pm

“Normal” is five-year mortgages between 6% and 8%.
_______________________________

Vancouver’s death knell.

#38 bcpaul on 06.07.13 at 12:32 am

Kelowna is a great town. It has malls and….hmmm…uhh…

Gotta run

#39 z-man on 06.07.13 at 12:42 am

#25 Canadian Watchdog

Hi, can you share the raw GTA transaction data of May please? I remember you posted the March and April one. Can you share the May one too or I missed it somewhere here?

#40 Dean Mason on 06.07.13 at 12:46 am

To Smoking Man #13

If tomorrow’s U.S. jobs report comes in under 120,000 and last 2 or 3 months jobs numbers don’t get revised up or worse get revised down you will see a full 1 and 16/32 to 2 and 1/8 increase price decline in the U.S. 30 year bond.

This would mean a 12 to 16 basis points drop meaning a 3.10% to 3.14% U.S. 30 year bond.If they are decent numbers 190,000 to 220,000 the opposite reaction would mean a possible 3.35% U.S. 30 year bond.We will see tomorrow what gives.

#41 jerry on 06.07.13 at 12:49 am

About as concise a summary as you will find

http://www.fool.ca/2013/06/06/a-brewing-canadian-crisis-and-what-americans-learned-about-bubbles/

#42 Dean Mason on 06.07.13 at 12:52 am

Correction To Smoking Man #13

If tomorrow’s U.S. jobs report comes in under 120,000 and last 2 or 3 months jobs numbers don’t get revised up or worse get revised down you will see a full 1 and 16/32 to 2 and 1/8 increase in the price of the U.S. 30 year bond.

#43 David McDonald on 06.07.13 at 12:56 am

Garth must feel lonely. The spin in all the national newspapers was overwhelming. We have nothing but logic and Garth to guide us through the haze.

#44 Tom Vu on 06.07.13 at 1:10 am

Blog photo

Either shark is g*y or a deputized bylaw officer

#45 JumpingJack on 06.07.13 at 2:21 am

Garth, did you hear what Lisa Raitt said about you today on to the press? She mocked you. She said:

“Garth Turner was the guy that I ended up defeating and he did the same thing, so you know you reap what you so”

In a super arrogant voice. What a bitch.

You cannot be ‘defeated’ when you stand by your principles. — Garth

#46 Joe Calgary on 06.07.13 at 2:22 am

I noticed that CREB came out with may numbers 2 days before may was over. I wonder what that’s about.

#47 Canuck Abroad on 06.07.13 at 2:53 am

Bloodbath in REITS? A little perspective needed? Take a look at the five year chart. Look at the ten year too. The REIT index has had a tiny little pullback in a multiyear uptrend. Sheesh, relax.

http://www.theglobeandmail.com/globe-investor/markets/indexes/chart/?q=RTRE-I

Anyone who bought above 170 congratulations you bought “high”. You can see this from the long term charts. You are supposed to buy “low” and sell “high”. Most people however buy “high” (greed) and then panic out “low” (fear). This is true not only for REITS and all other stocks and bonds, but also for houses (which is what we have all been watching over the last five+ years, in Vancouver especially).

#48 Mike on 06.07.13 at 3:09 am

Interest rates between 6-8% Garth?

Don’t you think that’s a touch alarmist.

Do you realistically forsee rates being that high over
the next 5-10 years?

The US was house horny beyond belief and they didnt raise rates. And if the housing market in Canada hits the skids as you’ve been hoping, the last thing the F will do
is make the crash worse by bumping up rates to 6-8%.

Respectfully, I’m curious if you actually believe your own hype.

Of course rates will normalize. — Garth

#49 Buy? Curious? on 06.07.13 at 3:32 am

Thanks for the advice, Garth. It is much appreciated. I don’t know why people avoid such good advice over such an extended period of time.

http://www.youtube.com/watch?v=7wVagQ_LVd4

#50 Gary M on 06.07.13 at 4:11 am

I liked your post Garth. But that was a really bad analogy to the Hindenburg Omen.

#51 World Traveller on 06.07.13 at 5:14 am

#30 Math Teacher on 06.06.13 at 10:30 pm

Don’t mind Smoking Man, his fictional rantings will soon bore you.
I mean, how many times can you read how smart he is and how dumb the rest of us are? (Despite the grade 1 level of spelling in his posts.).

#52 Ballingsford on 06.07.13 at 5:17 am

Photo: Must be another greater fool who wasn’t taught how to do things in life. That’s not the way to fish with ‘live bait’.

Moby Dick

#53 World Traveller on 06.07.13 at 5:22 am

In other news, how happy are you all to live in a police state? This is definitely not the country I remember…

http://www.thestar.com/news/crime/2013/06/06/toronto_g20_police_assault_trial_adam_nobody_accused_of_fomenting_unrest.html

#54 Smoking Man on 06.07.13 at 6:23 am

K#50 World Traveller on 06.07.13 at 5:14 am
#30 Math Teacher on 06.06.13 at 10:30 pm

Don’t mind Smoking Man, his fictional rantings will soon bore you.I mean, how many times can you read how smart he is and how dumb the rest of us are? (Despite the grade 1 level of spelling in his posts.)

……

The fact that you eqate good spelling to smart, proves your not….

World traveller you are not. Your just a normal who swallowed the little red pill.

Unfortunately for you, your oblivious to the obvious.

#55 Devore on 06.07.13 at 6:24 am

#9 Bob Copeland

He just contacted me asking if we could change the offer by increasing it $20k and show a cash credit for it so my price stays the same. However it would keep the value up for the neighborhood. I wonder how often this happens?

In the US they often have “seller assist”, which is an amount, sometimes significant, returned to the buyer. Although I never heard of this happening in Canada, at least not recently, builders have been offering for some time various incentives and hidden discounts, without directly lowering the price. Throwing in “free” cars (or equivalent cash back), subsidized mortgages, $0 maintenance fees, gifted downpayments, appliance packages and finishing upgrades, anything but an actual price drop.

#56 Buy? Curious? on 06.07.13 at 6:33 am

Hey Garth, who’s the wacko who posted first? Did someone knock off his fedora on his way to the library? Easy, Pointdexter! No reason to get your panties in a knot.

#57 Raven on 06.07.13 at 7:23 am

Steady as she Goes

The permit blip of late is a mirage, created by statistical over exuberance. Don’t be fooled by the multi family spike in permits as these numbers are large projects started many years ago, waiting to get their sales required to finance, and submit for permits. These large condo permits skew the numbers to uleash the statistical analysis hounds to massage them to their liking. These numbers will only hasten the ensuing crash as they will look much worst when the cancelled projects merge with declining sales.

Wait for July permits-sales and the start of meaningful price declines. Although these won’t be released till September.

Definition of Statistics: the source of producing unreliable facts from unreliable figures.

#58 World Traveller on 06.07.13 at 7:28 am

#53 Smoking Man on 06.07.13 at 6:23 am

Don’t assume to know me. I have been and lived in over 20 countries, friend.
By the way, good spelling does equate intelligence, it just takes a small bit of intelligence to use the spellcheck feature, Cheers!

WT

#59 World Traveller on 06.07.13 at 7:29 am

#53 Smoking Man on 06.07.13 at 6:23 am

By The way, how are those royalties on the Canadarm going?

WT

#60 economictsunami on 06.07.13 at 7:31 am

An interesting read on Scandinavian countries:

“At the current pace of amortization, Swedish households will need 140 years on average to repay their home loans, the Financial Supervisory Authority estimates. In Denmark, interest-only loans make up more than half the country’s $490 billion mortgage market, central bank figures show. Danes carry the world’s highest debt burden relative to disposable incomes, at more than 300 percent, the Organization for Economic Cooperation and Development estimates.”

http://www.bloomberg.com/news/2013-06-06/moody-s-questions-safety-of-nordic-housing-market-as-debt-grows.html

CBs are reaching the maximum benefit from their current monetary policy/ QE limits. Our new BOC Guvna Poloz stated as much:

China: “The extra #GDP generated by each #yuan of credit has dropped to a ratio of 0.17 from 0.85 four years ago.”

http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/10102008/Emerging-markets-displace-Europe-as-fulcrum-of-world-risk.html

As for your “balanced portfolio” you might want to learn how to become a successful day trader. ( I don’t have bosses to keep happy with my posted musings and nothing to peddle.)

Myself, I concentrate more on becoming debt free and staying very liquid.

I tend to sleep better, rather then chasing ghost growth…

#61 Sour Grapes on 06.07.13 at 7:41 am

I rent a 2 bedroom apt while my friends have huge houses in aurora. They seem to live a pretty good life. When is this downturn happening? Seems I’m the only one losing now.

#62 fancy_pants on 06.07.13 at 7:47 am

http://www.cbc.ca/news/canada/story/2013/06/06/housing-market-prices-overvalued.html

#63 Etobicokehead on 06.07.13 at 7:57 am

Here in the ‘coke there are bidding wars and houses are selling very quickly in the demand areas like Sunnylea. I think there may always be.

Toronto is kind of a shitty place to live, but there are many well-to-do people here. The well-heeled can and will always outbid you for a nice place with a yard in a friendly, safe neighborhood close to the subway.

#64 Tripp on 06.07.13 at 8:08 am

@ #59 economictsunami

“…Swedish households will need 140 years on average to repay their home loans…”

True, however their houses will last longer than that, often without major repairs. Not the case in Canada, where we constantly pour money into our wood, plastic & paper shacks to keep them livable.

#65 Pr on 06.07.13 at 8:35 am

You cannot be ‘defeated’ when you stand by your principles. — Garth Formidable!

Sales are still to high, to many buyers at those crazy prices.

Remember all of you buyers, a 1% interest increase from the bank represent roughly 10% more on your payment.

Ex: 1000$ a month payment. we increase the bank rate by 1% and now *every month* its 1100$

#66 Confused Again on 06.07.13 at 8:40 am

I don’t understand why people don’t believe you when you say rates will be between 6-8% again. Are their memories that short, do they all have Alzheimers?

We we bought our first house in 2000, the rate we got was 7.5% and house prices had shit the bed. I remember my dad telling me that 7.5% was a pretty good rate for the times. I also remember him lamenting about how his house value had dropped substantially. He was smart though, he took a small loss on his little house, and bought a bigger house that had a much larger loss. He waited out the ten years, and made way more selling the large house than he lost buying the big one. Percentages work that way.

The business cycle applies to homes too, because real estate and banking are both businesses. Is that really so hard to believe?

#67 Jeff in Moose Jaw on 06.07.13 at 8:57 am

“It will be consistent with our inflation target, which is to get inflation back up to 2 percent.” (Poloz).

This is how I read that “It will be consistent with our cost of living target, which is to get the cost of living to rise by 2 percent.”

What he should be saying to help the Canadian citizens (not just consumers) and the economy besides raising interest rates “It will be consistent with our cost of living target, which is to get the cost of living lower by 2 percent.”

That is an impressive house…. nice wine cellar.

#68 EIT on 06.07.13 at 9:05 am

Buying a house for 3, 4 or 5+ million, forget the home inspector, get a team of consulting engineers in there!

#69 gladiator on 06.07.13 at 9:13 am

@25 Watchdog:

In the movie 1984, the TV was spying on you – it could see and hear what you do when in front/vicinity of it.

Funny, but I recently looked at my gadgets at home and almost all of them have a camera and a microphone. An average hacker could easily use software that will video and audio record all I do and say when I have at least one of these gadgets around. This could be done even when the device is in standby mode (fyi: your location could be tracked with a very high precision even if your cell phone is turned off – you have to remove the battery from it to be truly untrackable; I am sure it could also hear and transmit what you say to the “appropriate people”). Now, the governments having such powerful IT teams, I think it’s a reality that very few are aware of.

Welcome to 1984, fellas.

#70 Shawn on 06.07.13 at 9:17 am

SPELLING IS IMPORTANT?

World traveler says: By the way, good spelling does equate intelligence

*********************************
Yeah, no, it don’t. And spell check is not always available on this blog. It depends on your own computer’s set up.

Much of the proper spelling in English is arbitrary and does not reflect a fully coherent and consistent set of rules and one of these days maybe it will have to change. Twitter and the internet in general will continue to change the way we spell.

Hope you are okay with that. or OK. K?

Pointing out minor spelling errors (often typos) on a blog where people anonymously dash off quick notes is anal and not intelligent at all.

#71 Chickenlittle on 06.07.13 at 9:40 am

#44
Lisa Raitt is my local MP…not by choice. I just moved there to save money.

Now I know why I shuddered when I passed her office for the first time.

#72 Gotthardbahn on 06.07.13 at 9:55 am

Hey Garth –

As I predicted yesterday, Canada posted stellar employment numbers this AM (+95K 7.1%) whereas Obamaland, again as predicted, created a pathetic 175K jobs. 175K jobs! In America! Four-odd years into recovery and interest rates at zero, and the economy can only create 175K jobs! And the mainstream media – Obama-lovers all – call this ‘good’ and ‘resilient’. They really do. You can look it up.

What does this have to do with house prices in Canada? Simple. Stephen Harper, whether intentionally or by accident or otherwise, has stumbled on to the policies that get Canadians working and the economy growing. It may be difficult for closet lefties like you to admit that, maybe, this Obama really is the incompetent fool I have long considered him to be. Or maybe, like most liberals, you do know that but you’d rather not acknowledge the fact. Whatever. The reality is that Canada is growing and America is not and that’s why house prices are rising here.

#73 Smoking Man on 06.07.13 at 9:55 am

#57 World Traveller on 06.07.13 at 7:28 am#

53 Smoking Man on 06.07.13 at 6:23 am

Don’t assume to know me. I have been and lived in over 20 countries, friend.By the way, good spelling does equate intelligence, it just takes a small bit of intelligence to use the spellcheck feature, Cheers!WT

…………

I don’t assume anything other that the fact I’m a genius..

Step out of the matrix for a moment and ponder this.

You blog a lot, and drink a lot. You chirp public figures all the time.

Pictor this, I am challenging a defamation case and a law suit.

My defence, not a good communicator, look at my track record re spelling and grammar.

That’s not what I meant when I typed it..

Genius :)

plus why should I endorse the machine with obedient key strokes…..

#74 Uwinsome on 06.07.13 at 10:00 am

95,000 Jobs created in Canada. See, Brad Lamb was right…

L ittle O ld L ady

#75 Berniebee on 06.07.13 at 10:18 am

#4 Babblemaster

“Would love to see that happen, but it won’t.”
(Regarding mortgages rates rising to 6%-8%.)

Well, I would hate to see it happen, but it will.

The USA’s economic engine has been sputtering and coughing to life. It’s economy is recovering, the only question is how fast.

These once in a lifetime mortgage interest rates will be soon be toast and Canada will follow suit. (Whether we like it or not, our major trading partner calls the shots for North American interest rates.)
And then Mr. T. will comment on our over leveraged RE buyers: “I pity the fool!”

#76 Timothy on 06.07.13 at 10:24 am

my friend is moving to saskatoon.

sold his house in oshawa (~250,000)

buying new house in saskatoon (~400,000)

he says it’s expensive there.

i tell him he is better off renting a house…since he will only be there for a year or so.

he is going to buy a house regardless.

what do ya think?

is saskatoon bubbly like toronto?

#77 Mr. Plow on 06.07.13 at 10:42 am

But those who have taken advantage of the low rates over nearly the last ten years are laughing.

It was like free money.

#78 Daisy Mae on 06.07.13 at 10:50 am

#70 Chickenlittle: “Lisa Raitt is my local MP…not by choice. I just moved there to save money. Now I know why I shuddered when I passed her office for the first time.”

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

Premier Christy Clark will be the Westside-Kelowna Liberal MLA. She lost her own riding in the Pointe Grey area, so Liberal MLA Ben Stewart is stepping aside.

Can you imagine how WE feel? :-)

#79 Old Man on 06.07.13 at 10:52 am

#68 gladiator – it is funny you should mention 1984 and hacker within context, as it boils my blood what they can do. Some 18 months ago had a hacker in my system messing around, so sent off an email to a friend in USA for help. She said will use a sniffer on him for location, and he will be history, so do not shut down, as need to do a run; yep she had entered my computer system with just an email. I knew she was the best, but some things just need to be done, and that guy in the UK got what he deserved.

#80 Doug in London on 06.07.13 at 10:52 am

@Canuck Abroad, post #46:
You’re quite right, REIT’s (as well as utilities, preferreds, and today XRB) have been on sale, a good time to buy. Damn, I see the bargain hunters have swooped in like vultures and prices are climbing back up again. That starts my day off on the wrong foot, but I am at least comforted by the bargains I’ve scooped up in the last few days.

#81 Silver on 06.07.13 at 10:56 am

Way I see that house…
Put down deposit of $250….

And bid $100…

… then see what happens…

Be fun to do….

Silver

#82 Buy? Curious? on 06.07.13 at 11:05 am

*Press Realease* June 7, 2013

CREA Predictions for Q3 and Q4 2013

https://www.youtube.com/watch?v=dD_NdnYrDzY&feature=player_embedded#!

#83 Behavioral Finance on 06.07.13 at 11:18 am

Speaking of building insane houses. that story reminds me of David Siegel being taking to the woodshed when trying to build his irrational mansion in the US . Some people never learn or just have fairy tale priorities.

#84 Herb on 06.07.13 at 11:23 am

World Traveller,

our Smoking Man thinks he’s the little boy jumping up and down yelling “the Emperor is naked!”

Except that the emperor is fully dressed, and our little boy is bullocks-naked.

#85 jess on 06.07.13 at 11:24 am

canadian watchdog… who really desires secrecy?

Friday, June 07, 2013
Defenders of financial secrecy line up to stop U.S. Fatca project
The U.S. Foreign Account Tax Compliance Act (FATCA) is potentially the most powerful tool ever devised to stem cross-border tax evasion and to crack down on tax haven secrecy. Initially a U.S. initiative, it is now in the process of being adapted and multilateralised.

Now, of course, the Center for Freedom and Prosperity (CF&P) and a group of other ethically-challenged bodies in the United States, have decided that financial secrecy (subtext: for rich people only) and tax havens are very good things, and that Fatca needs to be repealed. They have put together a coalition called Repeal Fatca, which urges support for legislation introduced by libertarian Senator Rand Paul to repeal the majority of FATCA, leaving it an empty shell, and leaving the world once again wide open to abuse.

The CF&P has some odd bedfellows in this group. One is an organisation called the Center for Financial Privacy and Human Rights (an oxymoron, as this document explains) and the group also includes the highly influential Washington lobbyist Grover Norquist, who once declared that his goal was to shrink government “down to the size where we can drown it in a bathtub.”

For some very brief high entertainment on Norquist, spend two or three minutes watching this; for an explosion of the nonsense arguments put forwards by the Center for Freedom and Prosperity, read Treasure Islands, or this blog.
http://taxjustice.blogspot.ca/2013/06/defenders-of-financial-secrecy-line-up.html

#86 Craig on 06.07.13 at 11:25 am

Nice video. That wasn’t cheap to produce.

A friend of mine just bought a house like this in Phoenix. actually bigger and way cooler with secret rooms and other eccentric touches. In 2006 it was listed for 15million dollars but no one wanted it. It sat and sat as the owner was reluctant to lower the price. Lowball offer after offer, he refused until my friend finally bought it last fall for 3 million.

This is the experience that real estate owners in Canada can look forward to.

#87 Ralph Cramdown on 06.07.13 at 11:26 am

#71 Gotthardbahn — “As I predicted yesterday, Canada posted stellar employment numbers this AM (+95K 7.1%) whereas Obamaland, again as predicted, created a pathetic 175K jobs. 175K jobs!”

Yep. Here’s your mainstream, Obama lovin’ media:
http://blogs.wsj.com/economics/2013/06/07/government-continues-to-eliminate-jobs/
Fun quote from the other day: “Obama is doing to the Federal civil service what conservatives believe Reagan did.” It’s really more congress that’s doing it, but funny nonetheless.

So based on your prediction, you bought US equities and sold Canada, making lots of money as Canada fell and the US rose? Yeah, that’s what I thought.

#88 Mister Obvious on 06.07.13 at 11:36 am

#69 Shawn

I agree. Good spelling does not equate to intelligence. However, it does speak volumes about diligence.

I also agree that pointing out lexicographical and grammatical sloppiness is a redundant exercise on a blog like this.

Those traits speak for themselves.

#89 jess on 06.07.13 at 11:39 am

Why Didn’t the SEC Catch Madoff? It Might Have Been Policy Not To

Matt Taibbi provides background with regard to a whistleblower complaint filed by 56-year-old Kathleen Furey, a senior lawyer who worked in the New York Regional Office (NYRO

Read more: http://www.rollingstone.com/politics/blogs/taibblog/why-didnt-the-sec-catch-madoff-it-might-have-been-policy-not-to-20130531#ixzz2VXrFFeBQ

Read more: http://www.rollingstone.com/politics/blogs/taibblog/why-didnt-the-sec-catch-madoff-it-might-have-been-policy-not-to-20130531#ixzz2VXqt9Ry9

#90 Old Man on 06.07.13 at 11:40 am

I see that gold is crashing hard with lots of market reactions, but wait until you see what happens to Real Estate valuations in the near future, as Mr. Turner has it right, but disagree a bit. My vision is a sharp drop in 416, and 905 with condo stuff, and it will all be determined with location, but the hit is coming.

This morning had a pleasant experience as walked into a computer store chain that was out of this world, and my order was waiting for me just near the door; what a beautiful store; somewhat like tigerdirect, as needed some rare stuff at a huge discount, and all is well.

#91 TS on 06.07.13 at 11:41 am

If job market is not crashing, will property market be down?

#92 rosie "moving forward" on 06.07.13 at 11:43 am

#68 gladiator

The book was better.

#93 No Longer Innocent on 06.07.13 at 11:48 am

It’s only going to take one property type in one district in Toronto proper to start showing declines to kick off city wide trends. We are sheep and downtown condos prices will be our Shepherds.

#94 T.O. Bubble Boy on 06.07.13 at 11:53 am

@ #62 Etobicokehead on 06.07.13 at 7:57 am
Here in the ‘coke there are bidding wars and houses are selling very quickly in the demand areas like Sunnylea. I think there may always be.

Toronto is kind of a shitty place to live, but there are many well-to-do people here. The well-heeled can and will always outbid you for a nice place with a yard in a friendly, safe neighborhood close to the subway.
___________________________

I can think of one neighbourhood in EtobiCRACK where home values may have recently gone down… Windsor Rd:
http://www.torontosun.com/2013/06/06/etobicoke-house-linked-to-rob-ford-crack-cocaine-scandal

#95 Al on 06.07.13 at 11:56 am

As per Stats Canada – largest Job Gowth number since the 90’s for Canada !
Real Estate values rise where job growth rises.

#96 Chickenlittle on 06.07.13 at 12:05 pm

Smoking man is right.
My placement at a kindergarten class at school taught me one thing: the kids were being groomed to be obedient first graders. Not that there is anything wrong with having rules to follow, but individual kids were called out in front of their friends and raked over the coals right in front of everyone. I even saw one child’s work taken away and thrown in the trash because “people do NOT have purple hair.” Tell that to Picasso and all the others that broke the rules by being, of all things, creative.
Second, the school SYSTEM makes life miserable for most kids.

Quote:
My schooling not only failed to teach me what it professed to be teaching, but prevented me from being educated to an extent which infuriates me when I think of all I might have learned at home by myself.” -George Bernard Shaw

I do not blame most teachers. I think they work hard and have unrealistic expectations to live up to. It is the separation of learning from real life that really seems to annoy the kids, as it should.

The results of our modern schooling is evident everywhere, including the RE market. No one seems to be able to live without something very large looming over their heads, whether it be school or a huge mortgage. I guess we enjoy being slaves because that is what we have been trained to be since kindergarten.

#97 Canadian Watchdog on 06.07.13 at 12:36 pm

May TO Homes Sold csv data can be copied here. Summary for GTA and select areas can be viewed here.

#98 Ronaldo on 06.07.13 at 12:48 pm

#69 Shawn –

”Pointing out minor spelling errors (often typos) on a blog where people anonymously dash off quick notes is anal and not intelligent at all.”

You hit that one on the nose.

#99 Kent on 06.07.13 at 12:51 pm

Moved from Victoria to the Windsor (Ontario) area five years ago because housing prices in Victoria made them unaffordable. Prices were downright cheap here, not any more…I’m seeing prices here reaching Victoria levels. What are these people thinking? Would you rather have a house in, say, Leamington or in Victoria at the same price? Shortly, Victoria is going to start looking attractive again.

#100 WhiteKat on 06.07.13 at 1:05 pm

#84 Jess,

The best way to challenge secrecy is to do so by not being secretive. FATCA seems to favor secret methods of challenging secrecy, such as not being honest about the involved paperwork, discouraging or preventing public participation, censuring comments, pressuring nations to undemocratically agree to secret conditions hidden from the voter, not being honest with renunciation figures, etc. All of this heavy reliance on secrecy to combat secrecy suggests that eventually privacy will be transparent to secrecy with financial secrecy still being a secret.

#101 Ronaldo on 06.07.13 at 1:08 pm

#34 Smoking Man –

”Slaves for corporations. Dogs that wag tails, and lick balls.”

So true. And the reason I extracted myself from this before I was 30 back in mid 70’s and never looked back. Did go back though but only to see where I had been. Parked my car across from the Board of Trade Tower in Vancouver and sat and watched the people scurry in and out in their suits and ties and briefcases, all glancing at their watches. I shook my head and thought to myself, ‘I used to be one of them’. Now, 13 years into retirement and when out in the wilderness and climbing mountains and when come across an anthill, I think, ‘that looks familiar.’

#102 Etobicoke bidding wars -that can be easily checked on my heat maps on 06.07.13 at 1:09 pm

Just go here
http://recharts.blogspot.ca
and see the maps for bidding wars in Toronto
There is one for each work day of a month
Send us the links where you see REAL bidding wars not REAL ESTATE AGENT fabricated bidding wars

#103 Old Man on 06.07.13 at 1:10 pm

#95 ChickenLittle – The first diamond ring that I ever bought was for a kindergarten teacher in Mississauga, as we were in love, so became engaged, and it was a 1 carot bought on time payments. Well, was accepted into Law School, and said we need to have a meeting of the minds, so in marriage we must live off your salary for a few years with a struggle and all be fine going forward. Then she said got news for you as hate my job, and those nasty kids, so will be resigning, and threw my ring on the ground saying no deal mister.

This was the end to my first potential marriage in life, so had to go to Plan B, as my heart was shattered.

#104 45north on 06.07.13 at 1:13 pm

Stupesing in Cabbagetown and jerry: from your link:

Housing markets are regional. Attitudes toward housing aren’t.

This is what I’ve been saying. Large population centres determine attitudes i.e. cities. In BC once Vancouver turns the province turns. In Ontario once Toronto turns the province turns. The opposite theory is that small remote places are immune from the influences of the cities. I think in the past they were to a greater degree. Small towns were autonomous – inhabitants seldom went to the big cities. For example in Orillia Ontario before World War II a trip in to Toronto was maybe a twice-a-year occasion. Now it is a routine, commute on Highway 11, Highway 400.

Timothy: is saskatoon bubbly like toronto? Well for people in Saskatoon, a trip in to Toronto is still a twice-a-year occasion but I can tell you that cuts in the Federal Civil Service are affecting employment in Saskatoon. I’d say as a percentage of population, the cuts in Saskatoon are more than in Ottawa.

#105 May job creation -that is actually bad news for the economy on 06.07.13 at 1:17 pm

If the economy continues to expand in that direction they you have two things that could happen:
-with sales down and increasing inventory (for condos) this will accelerate the downturn. They will probably have to sell for less but still with a good profit (this is actually their thinking) and the resale price will have to follow.
-if the economy is really doing better that means that it is recovering and the government will be forced to step in and increase the interest rates which again will hit the Real Estate market.

Unless we go for a long long and gradual depreciation the inflation will never diminish the inflated prices that we have today. But that in its turn will lead to a long recession unless Canada learns that an economy can not live by buying and selling house.

#106 Canadian Watchdog on 06.07.13 at 1:20 pm

If you're having trouble copying data from post #96, try this. May TO Homes Sold Part 1 and Part 2

#107 WhiteKat on 06.07.13 at 1:28 pm

Traumatized by the IRS and USA reaching into Canada?

You may feel you need help because:

You are or have been threatened by the imposition of life-altering fines for failing to file information returns you had no reason to know existed;
You feel victimized by the Canadian and other non-U.S. media, who have constantly referred to you as a “tax cheat” and advised you to “come clean”;
You feel “taken advantage of” by the so-called “cross-border professionals”.
You just want to be compliant with the law, but you receive conflicting advice, and nobody seems to be able to tell you how to do it, yet they are asking for “huge” fees;
You feel completely misunderstood by the non-U.S. citizens in your life. They can’t understand the feelings of fear, betrayal and injustice that you feel. In some cases, this experience has put your marriage at risk;
Your health has been dramatically affected by all of this. You can’t sleep. You worry. You have gained or lost weight. You are no longer the happy person you were. You feel that your life has been stolen from you.

A FREE 2-part session is being offered in Toronto on Saturday June 15 to help. The morning session will focus primarily on the emotional issues and the afternoon session on practical issues.

Session I: The Financial and Emotional Costs of U.S. Citizenship Abroad

When: Saturday June 15, 2013 10:00 a.m. – 12:00 noon
Where: Downtown Toronto – Near U of T – Final location posted on June 13
Who: a Senior Licensed Psychologist
Description: Since 2011, the Obama administration has subjected millions of people Living outside the United States to a vicious attack. This includes reaching into Canada. The IRS has literally threatened millions of innocent persons living outside the United States with fines exceeding their personal wealth–up to 380% of their financial assets. For many, this experience has taken a toll on their mental and physical health, and that has been even greater than the financial damage. A psychologist will address the emotional issues associated with the threats and demands that IRS is making. He will describe his own emotional experience and encourage others to share their own emotional reactions to these circumstances. Strategies will be discussed on how to cope with the stress caused by the IRS and the difficulties of living as a U.S. person abroad.

Session II: US Citizenship Abroad and Compliance Issues – Where we have come from. Where we are. Where we may be going

When: 1:00 p.m. – 3:00 p.m.
Who: An experienced Toronto lawyer
What: Focus on more practical issues
Description: Beginning in the summer of 2011 the IRS aided by the media and cross-border professionals began a relentless attack on U.S. citizens in Canada. The spectre of FATCA has worsened the situation. The purpose of this session will be to review:

Summer of 2011 – where we have come from
2011 to now – where we are now
2014 and onwards – where we may be going
What might this mean for U.S. citizenship in Canada? What are some possible responses? How can/should you respond to a difficult situation?

Please note that although this event will take place on June 15, it is NOT a session on how to file a U.S. tax return. The discussion will however include relevant U.S. tax issues and reporting/information returns.

#108 Craig on 06.07.13 at 1:59 pm

My predictions / comments for the team;

Interest rates stay low forever or until the US gets a handle on its debt (so forever) Please save the Bond Market controls rates speech as that is totally manipulated. Rates go up the US defaults, markets crash like we’ve never dreamed they would, along with everything else.

House prices pull back as I said before 10-15% max. Keep in mind this is the summer and sales always drop now so lets not spin this into something it’s not.

The stock market will crash in October if not sooner and it will mimic 2008. Be careful and no I’m not a gold bug but holding 10% in your portfolio is a smart move, IMO.

QE 5,6,7,8,9, etc…… are here to stay forever or until the US gets a handle on its debt (so forever)

RE agents are salespeople. All Salespeople lie, that’s their job. That’s how they live…commissions, so deal with it! Politicians are salespeople….join the dots.

For every report / chart / blog on the internet that supports a certain perception / theory, there are an equal number that counter it.

Deal with it and don’t forget – BS baffles brains.

Think for yourself – don’t be herded

#109 Smoking Man on 06.07.13 at 2:00 pm

Amazing jobs report today.

Typically when that happens up go the rates, well I have been saying that machine wants to inflate debt away. Re balance put more money in the hands of labour.

So now wage pressure is creeping in. IF BOC does not spike rates….

Means my theory is dead on

In the old normal world, min 1/2 point spike., now you will see nothing. Mortgagees win, savers lose

#110 EIT on 06.07.13 at 2:11 pm

The Syrian conflict is escalating and escalating. You’ve now got the Hizballah-Assad alliance. I wonder how long before US intervention (a large US force is positioned on the Jordanian-Syrian border). And Russian troops facing off against the Israelis is now a pen-stroke away. This war is escalating, no question about it.

#111 dradak1 on 06.07.13 at 2:38 pm

#34 Smoking Man on 06.06.13 at 10:57 pm

You don’t have to prove (over and over) that you are not that bright. If you have enough memory – you can recall that I stand for you and your “free thinking”.
Reasond that teachers marking the students is for there “stupid” parents to see what there child is good (or not) in. Teaching is like making good “foundation” and as more educated kids are ALL OF US will benefite from – like building house on those foundations instead of shedhouses.
BTW – I’m not teacher and not related to them on any way – and I’m the one of the parents that I called “stupid”.

Get a grip

#112 dradak1 on 06.07.13 at 2:44 pm

#37 bcpaul on 06.07.13 at 12:32 am

“Kelowna is a great town. It has malls and….hmmm…uhh…

Gotta run”

You forget a restaurant – at list was there during my staying. :-)

Just kidding – nature is beautiful – nested in Rockies.

#113 Mr Buyer on 06.07.13 at 2:54 pm

#34 Smoking Man on 06.06.13 at 10:57 pm
Is that what you believe you are doing, then why are you marking them, judging them.
…………………………………………………………….
Wow, Mr Survival of the fittest, take no prisoners lie cheat steal the hell with everyone else Smokingman must have got your feelings hurt when you were a wee little fella by those big bad filthy attitude teachers. There are hordes of crusted over burnt out teachers phoning it in with administrators acting as little more than functionaries because it is tiring to engage full on with students day in and day out, especially if one does not have the mental schema for it at any given time. Having said all that, TESTING is a very important component of many learning processes. Many do not fully incorporate ideas into their working knowledge in the absence of testing. While admittedly not for all, testing is a very valuable teaching tool. While testing is used by many societies for scoring and sorting future haves and have nots this is not an evil in and of itself but rather a small step away from rich begetting rich. When testing is a one time thing that forever places a person in a position within a society then it is a great misuse of the valuable teaching tool. I submit that such is not entirely the case in Canada with avenues available to retake tests at various times throughout life. We could do much more by way of providing state of the art resources widely available to the population at large through a national fiber optic network that provides courseware and testing facilities for anyone anywhere in this great country thus allowing people to change their stars if they so wished. TESTING would likely still be be a big component of the evolution of a world leading technologically sophisticated work force that could be Canada. Conform my butt, it is more like learning some basic manners.

#114 Ms BBoomer on 06.07.13 at 2:56 pm

“You cannot be ‘defeated’ when you stand by your principles.” -Garth – Thankyou, one reason I visit your blog is because you stand by your principles.

#115 Tom Vu on 06.07.13 at 2:57 pm

News Update from Toronto !

Brad Lamb called in for emergency !

Market desperate…allowing ZOMBIES into condo line-ups.
(Must show no brain activity = fit right in with rest of citizens!!)

Zombies rioting…they actually read sales agreement! ( unlike non Zombie 416 ers )

The police and army called in.

http://www.youtube.com/watch?v=bwKSJQI3tco

#116 LTD on 06.07.13 at 2:58 pm

Japan’s interest rate has been lower than ours for almost two decades. Don’t confuse history with “normal”. Rates are not going to 6 – 8% unless consumer inflation takes off, which isn’t very likely in the medium term.

#117 Ms BBoomer on 06.07.13 at 3:07 pm

For Smoking Man: I just wanted to write that I have read your comments for many years now, and have gone from thinking you didn’t know what you were talking about to realizing you are brilliant in your own way. I loved your “inappropriate behaviour” comment; it reminds me of a friend’s grandson, Luke’s recent behaviour. During a parent-teacher-child meeting, Luke’s kindergarten teacher expressed her concern that Luke was colouring outside the lines. Luke immediately replied “Those are your lines, not mine.” Luke has not taken the red pill yet, lol. Anyway, Smoking Man, I love and appreciate your ‘inappropriate behaviour’ on this blog, you are a breath of fresh air. Thankyou for who you are.

#118 I am in C on 06.07.13 at 3:41 pm

Garth
What do you think of this.
Houding prices in Canada will not collapse in the next 10 years. They are going to hang there and fester. The end result, we will have a middle class consisting of property owners and non property owners

#119 robert james on 06.07.13 at 4:05 pm

#111.. I would be the last one to pee on your parade but I can assure you the Kelowna is not “nested in the rockies”

#120 Dr. Hoof - Hearted on 06.07.13 at 4:16 pm

HAMville desperation update

A building lot I have been keeping an eye on…

Over a year ago, this 1960s house in West Richmond was demolished. The site was cleared , sand brought in…..ready to go.

The owner got cold feet….and put the lot up for sale….sat UNsold for 9 months .

Over the last 2 weeks, the built forms and poured the foundation.

IMHO…. If it had been sold…the realtors would be desperate to BRAG with a “SOLD” sign.

My guess is the builder bought at peak….doesn’t want to sell at a loss aka CURRENT market price…and is now going to gamble on building a new house…when there is already a glut of new houses for sale. DUMB…

I am even seeing UNcompleted houses for sale.(aka usually only “For Sale” when everything is finished ).

Finally I am also observing homes whose construction is dragged out…even the South Asian builds, where on any given day there are 5-10 people on site.. Its a beehive of activity for a while ….then nothing.

Very VERY strange out there.

#121 Post Haste on 06.07.13 at 4:17 pm

Back in 2001, I clipped out a mortgage report that noted back then that the average 5yr fixed was 11% – we used that figure to determine if we could hold a mortgage and if we had only one income to rely on – we placed some serious stress tests on our budget and it was workable.

I believe the housing market is similar to the stock market – it is defying logic…to the moon baby!!

The globe reported that building permits (no fudging those numbers) were up last month. Those who sit in their basement apartments with their banners of doom for homeowners will have to wait abit longer – (how many years has that been now?)

#122 zorik on 06.07.13 at 4:22 pm

Garth, I would love to see what your top 10 or 20 stock picks would be (though I know you don’t care for individual stocks). Top 10 favorite ETFs, preferreds, REITs, etc.?

I’m sure you would. — Garth

#123 blokexistentialist on 06.07.13 at 4:25 pm

#45 North is correct re: observation about smaller places in each province reacting to the ebb and flow of prices/housing in Vancouver and Toronto. And Calgary, I’d like to add, because it forces up housing prices in the B.C. bedroom communities near the provincial border.
My own hidey-hole in B.C. is tiny, but an unprecedented number of houses/properties in the range of $350,000 to $550,000 are languishing on the market. This place will recover, but these new, massive big houses are going to take a considerable dive.
Out-of-towners yearning to bury themselves in the country are holding off on buying them, which is a new trend this spring as well. They were snapping them up before. I think these giant energy suckers are likely to drop to close to half their asking prices aka Vancouver over the next few years before they find a buyer.

#124 Dr. Hoof - Hearted on 06.07.13 at 4:39 pm

Hell, it already isn’t in Kelowna, the cleavage of the Okanagan.

In two weeks an $8 million dollar extreme house (which can’t sell) goes on the auction block in a rare no-reserve-bid event. Says our correspondent, Dave:

Built in a gated ‘hood I have watched since it was just a bunch of steep hilly lots. One other house there started at 6+ million, and is now on the market at roughly half price, still vacant. This one, I am told is appraised at 7+ million. Obviously, they just took the square footage of the main and pool house and multiplied by 1,000.

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

Re this auction…

I doubt it is really UNreserved….

What the owner will do is have some phantom bidders in the audience..to make sure the house is not given away.

“RESERVED ” usually means a minimum bidding price.

If the owners bottom line price is say $4.75 Million, and the highest price looks like it may be $4.25 Million….I can guarantee someone will “put up a paddle” at $4.75 Million.

However, if this happens, it may create a taint to the given property and any other such UNreserved auctions.(unless perhaps by banks)

Then again, this begets the other question, of how much shadow inventory is REALLY out there ? Are the bankster pulling strings so that a domino/toilet flush effect is not started?

Putting up a $4.25 million paddle would cost $340,000 in commission to the auction house. Great strategy. — Garth

#125 Ralph Cramdown on 06.07.13 at 4:47 pm

#117 I am in C — “What do you think of this. Houding prices in Canada will not collapse in the next 10 years. They are going to hang there and fester. The end result, we will have a middle class consisting of property owners and non property owners”

It seems that the general conception of ‘soft landing’ among real estate agents, bankers, mortgage brokers and builders is that it’ll affect the other guy, a bit, maybe. Simple math says that if prices slip 10% and sales drop 20%, business is down by 28%. But all these businesses have overhead, from office rent to licensing and insurance to the car lease, so profits are going to be down a lot more than 28%. Loans for builders are going to dry up. Banks are going to lay off hundreds of people at a time (actually, if I understand correctly, a lot of bank employees these days are part time with no benefits, so their hours will just be cut back).

Unless you believe that the economy is very flexible and all these white collar workers are going to spend three months retraining to become pipeline welders, I don’t have a lot of confidence that export and manufacturing are going to quickly soak up all the excess employment that was building and selling more homes than household formation warranted. Now I ask you: Is there anyone more likely to own rental property than real estate agents and mortgage brokers? So a lot of those will go up for sale…

I could be wrong, but that’s how I’m betting.

#126 Smoking Man on 06.07.13 at 4:50 pm

#112 Mr Buyer on 06.07.13 at 2:54 pm

Testing is a filter designed to separate those that will obey.

I became a guru code smith and trader via the Web.

I can’t learn from reading, I need to see live samples

School is a business, it’s goal, Maken slaves not owners.

The teacher are oblivious to the role they play, they think they are helping.

Go to zero hedge and read the story, 20 dumbest courses in university, school is business, do you think I would be churping it if I could get in on some of the $ction

#127 Smoking Man on 06.07.13 at 4:57 pm

http://www.zerohedge.com/news/2013-06-07/20-completely-ridiculous-college-courses-being-offered-us-universities

Herb read this, then I await your rebutal

It’s a scam an a crime against kids

#128 jess on 06.07.13 at 5:16 pm

whitekat –
gov. should not have to rely on leaked data

ICIJ has refused to release the data, but on May 9 the organization announced that Australia, the U.S., and the U.K. had independently received a large batch of leaked files related to phantom firms. The German press reported that Germany also has access to the data.
=============
lookback

May 1996
http://www.taxanalysts.com/www/features.nsf/Articles/F3AA18739F0EFF008525744B0066459B?OpenDocument

====
As prosecutors seek Korean ex-president’s hidden billions, #offshoreleaks files find his son’s BVI company t.co/RnNWzZCIum
1 hour 56 min ago.
http://www.publicintegrity.org/2013/06/04/12764/son-former-korean-president-obtained-secret-offshore-company-amid-family-s-tax
The global shell game is harmful to both developing and developed countries. It is time for world leaders to say “game over”.

=

The UK Gold: watch the trailer for new documentary about tax avoidance – video

Filmed during the London 2012 Olympics, Mark Donne’s documentary reveals a modern Britain dominated by a financial sector that relies on unfair play for profit.

#129 brainsail on 06.07.13 at 5:21 pm

You really can not compare US vs. Canadian unemployment numbers as apples to apples. The unemployment numbers are based on different metrics.

“Canada’s May jobs blowout sparks hopes, caution”

“Canada’s jobs figures are based on interviews with households whereas the U.S. payrolls data is based in information from hiring companies.”

http://ca.news.yahoo.com/canada-may-job-gains-biggest-11-years-123610355.html

#130 Dr. Hoof - Hearted on 06.07.13 at 5:34 pm

Putting up a $4.25 million paddle would cost $340,000 in commission to the auction house. Great strategy. — Garth

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

Uh no…..I submit the auctioneer and the seller are in cahoots…

The seller would be guaranteed some minimum fee for their efforts.

They are trying to attract vultures via faux broken wing premise. There are no rules in this game….

Who is the auctioneer…? A reputable one has a global mailing list and pre-screened clients.

Or Garth, what would YOU do if in the sellers position..seriously

#131 Bob Copeland on 06.07.13 at 5:42 pm

#22
I know. It’s in Indiana which has fixed property taxes at 1% for homeowners, 2% for rentals and 3% for commercial. I said no, I wouldn’t do it. Blew him away that I would say no. Came back with it helps me too.
My point is, what numbers can you believe? Home sale prices? Unemployment? Any?
Everything in every country seems to be based on lies and those that can scams everybody. America is a scam and a big bubble. Garth is my hero but when he brags about and admires America I’m embarrassed for him.
He’s a little to trusting. I live in the most dishonest country in North America.

#132 Math teacher on 06.07.13 at 5:46 pm

#34 Smoking Man on 06.06.13 at 10:57 pm
Is that what you believe you are doing, then why are you marking them, judging them. That’s not teaching, that’s segregating, and controlling. The idiot fish that can’t climb a tree gets a D.

Please, you take marking and judging out of the equation your my best friend, but you can’t you will lose your job, your roll is not to make smart people who dream and create and build, You destroy the individual for a happy dog that fits into collectivism.

Your job is to make obedient little yes men , who are afraid to challenge your position of authority, which carries into the working life.

Slaves for corporations. Dogs that wag tails, and lick balls.
————————————————-

Without marking students, everyone would become a doctor. Now, what kind of world would that look like? Would you really want someone to perform surgery on you who hasn’t met the requirements? Requirements are at least a pass/fail basis, or a binary outcome if you prefer…

The students that show the most proficiency in certain subject areas go on to college or university in those areas. Most of the street smart students opt for programs that have co-op or internships. Seems like a fair deal to me…

The reason why grades are needed is to filter students out of certain university/college programs. Why should society subsidize someone’s education who most likely won’t succeed in a certain career?

The reality is the average salary of university/college grads is higher than non university/college grads. You perhaps have done well in life without higher education, and you may very well be the exception.

Did/do any of your kids attend university or college?

#133 Herb on 06.07.13 at 5:47 pm

#126 Smoking Man,

in my day, it was “Basket Weaving” offered in some US colleges. So what?

Where is the list of the thousands of courses that are not “ridiculous”?

#134 Dr. Hoof - Hearted on 06.07.13 at 5:53 pm

#125 Smoking Man on 06.07.13 at 4:50 pm

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

I agree

….after War(aka bankster funded)…..the next biggest racket is the Education system.

It is a cult -like indoctrination system.

Those that “Go All The Way” to get a degree have swallowed the Kool Aid. They become members of the “charter”.

They are overwhelmed with BS, especially in the Arts fields, to become little marxists err….”politically correct” robotic tools.

Society has always feared free, ” practical” hands -on thinkers who figure things out in 1/10 (or less) the time .

Yesterday at a family dinner, my in- law said his 26 year old son(with a BA degree), is now going to be an electrician, and was hired immediately.

My only concern is that the shift of focus by Gov’t to Trades will glut that market too…

It may end up a fight for cab driving jobs between PhDs in Fine Arts versus Welders

#135 Bob Copeland on 06.07.13 at 5:55 pm

#54
I know but this was after the deal! This is a summer condo (home,family), I live in Florida. You guys have no idea how good you have it!

#136 Thanks CanadaWatchDog...keep posting this sort of data on 06.07.13 at 6:06 pm

Thanks a lot for the data posted. How do you explain the difference between your numbers and TREB’s numbers. I am not saying they are wrong ..I am just asking since I just learn that they do not count Condo Townhouse unde the Condo category
BTW ..could you also post the dwelling type (ex: detached, semi, TH)

#137 screwed on 06.07.13 at 6:11 pm

#126 Smoking Man
The same source you quoted has been tracking the student loan bubble for years. Guess where the biggest demand in credit is coming from? Student loans and car loans.

PhDeeee Barristas partying it up at looser ville. Meanwhile the boys who picked up a trade at a young age, quit school and developed a real skill set are working hard and making good money.

Schools are basically farms where kids are herded into class rooms (stalls) and they develop their herd mentality. Most teachers are overrated, overpaid and underqualified to really make a lasting impression and deliver inspiration to the kids. They’re just happy taking the pay cheque and leaving the kids out to graze.

#138 Smoking Man on 06.07.13 at 6:34 pm

#131 Math teacher on 06.07.13 at 5:46 pm

You just cant see the trees in the forest.

Why can’t kids learn with videos, one video can replace 10000 teachers saving me a fortune in tax, why is the shelf life of a university text book expire when the term ends.

Doctors kill 10 times more people that drunk drivers.

Son 1, Door to door sales men, makes 6 figures 27 years old

Son 2, construction makes 6 figures only works 8 months of the years 25 years old

Son 3, my clone, runs a small food distribution company makes more than 1 and 2 put together. 23 years old.

Son 1, 2 years at Fan shaw, business insurance

Son 2, did not graduate high school, however he has a BA the owner of the pro hockey team in Europe he played for got him it.

Son 3, Two years at Humber Collage, business, quit cause the teachers are idiots.

Way ahead of me when I was there age….

#139 Dienekes on 06.07.13 at 6:39 pm

#124 Cramdown
I’ve noticed in Saskatoon a huge amount of resales go on the market last month, houses I suspect being rentals, frightened landlords? I don’t know, but it is weird.
I’m in Croatia, sitting in an apartment looking over Trj Bana Jelacica. What a great country. I hope the EU doesn’t destroy it. Nothing like the stupidity of North America. There’s no fat people either, even I don’t feel like eating, must be the lack of stress.

#140 calgarytran on 06.07.13 at 6:51 pm

RBC poised to lift mortgage rates starting next week

http://globalnews.ca/news/623837/rbc-poised-to-lift-mortgage-rates-starting-next-week/

More foreclosures on the market.

#141 Mr. Monday Night on 06.07.13 at 7:30 pm

I have a friend who has had to move for work and sell his house (empty over the past six months). He listed his house for what he paid for it in 2010 to ensure a quick sale. The house has still not sold, and his RE agent suggested he re-list for $10K less. My friend in turn fired the agent in indignation and is now prepared to wait out the market.

The losses mount and he is digging in for $10K? Emotional investment indeed.

#142 Westernman on 06.07.13 at 7:34 pm

Herbie, Herbie, Herbie…
I see you are on Smoking Man’s case today – trying to paint him as the big bad wolf that has no empathy for his fellow humans…
You see Herbie, not everyone has the luxury of being coddled in the civil service racket like you – some of us ( the ones paying for your fat civil service pension ) had to cut it in the free market and thusly do not have the naive viewpoint of how the world works like you.
Your view of the world is that of a smarmy pubescent living under Dad’s roof – Smoking Man’s viewpoint is that of “Dad”…. I trust you get my meaning Sir…

#143 Dr. Hoof - Hearted on 06.07.13 at 7:55 pm

How Big is Canada’s Student Debt Today?

http://www.debt101.ca/news/how-big-is-canadas-student-debt-today

QUOTE:

It’s mesmerizing, though not as soothing as a lava lamp…J

When this piece was written in 2009, the clock was under $13 billion. At writing, the clock now shows over $14 Billion for federal student loans.

But as the CFS states beneath the clock, this only represents part of Canada’s student loan debt. It doesn’t count Canada’s provincial and private student loans.

So the student debt facing Canadians is much higher than $14 billion.

Let’s do the math:

Federal loans make up roughly 60 percent of the dollar amount of government-sponsored student loans. $14 Billion is roughly 60 percent of a total $21.5 Billion.

Estimating Canada’s private student loan debt is harder. Individual banks and the Canadian Bankers Association tell Debt 101 they can’t give numbers. So let’s play it safe and assume private loans are less than 2.5% of government student loan amounts.

That still rounds out Canada’s total student loan debt to over $22 Billion when the debt clock hits $15 Billion.

$22 Billion! A lot of Canadians are struggling with student loan debt, just like you…

So until we can show Canada’s full student debt, watch this clock and add 40 percent!

etc etc.

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

Unfortunately, the Gov’ts have failed our Youth. They allowed the Universities to become fiscal rape and pillage students with a combination of worthless degrees and/or a flooded market.

They take their ” endowment lands in trust” and the develop them , building up huge coffers, but not assisting tuition. UBC pays its soon to retire President over $500,000 annually.

Then they allow “schools” like Sauder with Professors who are snake-oil salesmen, like Sommerville , the “go to” expert for glib media quotes on Real Estate.

They have also sucked in the students that a Bachelors degree is not enough…Masters is the ticket !!!

Save your money folks…avoid the herd….this is another debt time bomb about to explode.

#144 AK on 06.07.13 at 7:57 pm

#139 calgarytran on 06.07.13 at 6:51 pm
“RBC poised to lift mortgage rates starting next week

More foreclosures on the market.”

——————————————————————–
“The special five-year rate will rise to 3.29 per cent.”
——————————————————————–

Geez, big Whoop.. I wish I had a 5 year 3.29% mortgage, during my mortgage days.

#145 neo on 06.07.13 at 8:01 pm

Can Garth and someone else explain how construction contributed HALF of the job gains in May if new home construction has been tanking since last September?

#146 JW on 06.07.13 at 8:03 pm

#137 Smoking Man on 06.07.13 at 6:34 pm

Son 1, Door to door sales men, makes 6 figures 27 years old
——————————————-

People are actually successful at door to door sales? I thought door to door tactics were dead thanks to the jehovah witnesses – as an aside I notice their propaganda doesn’t mention their full name, but instead JW…

#147 WhiteKat on 06.07.13 at 9:01 pm

#127 Jess,

From: http://www.theatlantic.com/international/archive/2013/06/the-unintended-consequences-of-cracking-down-on-tax-dodgers-abroad/276560/

Last week, Germany announced it would sign an American tax treaty that essentially makes German banks agents of the Internal Revenue Service.

The agreement is called the Foreign Account Tax Compliance Act (FATCA). The measure effectively forces banks to register foreign account holdings or face steep fines.

Some experts say that Germany’s approval of FATCA spells a tipping point for other countries around the world to give in to U.S. pressure to turn over financial data on American expatriates and green card holders.

FATCA’s sad reality — according to experts in both Europe and the U.S. — is that it will not have a notable effect on wealthy Americans who stow money in complicated offshore vehicles. Experts say that tax schemes of the sort that became a political liability to Mitt Romney during his run for president remain largely untouched by FATCA rules.

FATCA and FBAR (Report of Foreign Bank and Financial Accounts) comprise a set of rules that are disproportionately hurting middle class U.S. citizens and green card holders who happen to reside abroad or maintain accounts outside the US.

One New York-based lawyer expressed exasperation over how foreign banks in FATCA signatory countries are freezing accounts linked to Americans. “I know of one client whose parents live outside the US,” he said. “They are in their 90s, and have a bank account in their home country. They added their son as a signatory because if they become incapacitated, they want him to have access to money to pay their bills. But their account has now been frozen because he’s American. The bank wants the son to provide the last five years of his tax returns before it will unfreeze the account. He has had to hire a lawyer to sue the bank to let his parents access their own money.”

Douglas McFadyen, a tax partner at Shearman & Sterling LLP in New York, thinks FATCA costs a lot for banks to comply with but fails in its goal of eradicating tax evasion. What’s more, it makes the U.S. a less competitive place to do business.

“FATCA is another stop on the road to making the U.S. a less attractive destination for foreign capital, and U.S. capital markets less and less competitive,” McFadyen noted in a telephone interview. “The U.S. government still thinks we’re living in the 1960s, which is when these offshore tax avoidance regimes first came into being. At that time, New York was the only functioning capital market in the world. But that’s not the world we live in today. The U.S. government no longer has the ability to dictate tax policy to the rest of the world. People can go to Tokyo, Hong Kong, London. They don’t have to deal with the headache of doing business in the U.S.”

Yet FATCA’s most troubling legacy might be its impact on highly skilled Americans living and working aboard.

The measure is creating tax headaches for companies that give corporate officials with green cards or U.S. passports signature authority over their internal accounts.

But at least here, some companies have devised a quick and easy solution: they’ve stopped hiring Americans.

Data protection experts believe there exists an inherent conflict between FATCA and data protection laws in Germany– laws which protect foreigners living in Germany just as they do German citizens.

FATCA could potentially violate an individual’s right to informational self-determination, a right enshrined in the German constitution.

Will America’s nearly 100,000 expats living in Germany challenge FATCA in court? It’s too soon to tell.

But experts say they might have a very good case.

#148 Herb on 06.07.13 at 11:12 pm

#141 Westernmoron,

you, Sir, are an ass.

#149 z-man on 06.08.13 at 1:47 am

#96 and #105 Canadian Watchdog

Thank you very much for providing all the information in raw. Much appreciated!

#150 FutureExpatriate on 06.08.13 at 5:49 am

#9- It’s simple. The builder is ok with giving you a deal, but doesn’t want anyone else to know about it unless they ask for the same deal. Not really a scam, just selective salesmanship.

Now Zillow? Zillow is a COMPLETE scam.

#151 FutureExpatriate on 06.08.13 at 5:50 am

The pic… the ONLY time in the world a guy hopes he doesn’t have the biggest @#$%#@*()! in the world…

#152 Kent on 06.08.13 at 6:34 am

#146 WhiteKat –

The IRS already has this power here. Haven’t you been asked by your bank or broker if “you are a US Person”? They report all this back to the IRS.

#153 WHITEKAT on 06.08.13 at 11:51 am

#151 Kent,

No, I have never been asked if I was a ‘US person’, and it is a violation of charter rights for the bank to insist on knowing.

You are correct in that if your bank knows you are a ‘US person’, they will ask you to fill out a W9 and report your investment income to IRS. There is no harm done to the bank if they fail to detect a ‘US person’ in their midst currently.

However, FATCA is a whole different animal. It FORCES the banks to search all its clients and make them prove they are NOT US persons. Once a US person is discovered, the bank must report more than just income from investments. It must report all the account balances, deposits, withdrawals of every single account with that person’s name on it. The client MUST agree to this or his/her accounts must be closed according to FATCA.

If a bank refuses or misses identifying a US person, under FATCA, the bank will have 30% withholding applied to certain passthrough payments, and investment income that originate from the USA.

However, under Canadian law, currently banks have no right to ask you if your are a US person. You can tell them, but you don’t have to. FATCA forces banks to violate Canadian privacy and discrimination laws.

This is why banks have asked the Canadian government to sign an Intergovernmental Agreement directly with the IRS, so that banks will send account details to the CRA who will send it to the IRS. This gets banks off the hook re: privacy violations because they are following CRA directives if an IGA goes through. In addition, the Canadian government will have to change its privacy laws to accomodate FATCA.

Leading constitution lawyers in Canada (Peter Hogg for example), say that when/if Canada goes along with USA’s request, it will be a violation of our charter of rights and that there will be class action suits.

Can you imagine the nice lady at the bank asking if her client is a Jew and requesting documentation to prove he is not under threats of account closures if he refuses and promises of sending off ALL the clients account details to the IRS if he agrees? Substitute ‘person born in USA’ for JEW and maybe you will start to get the immensity of what IRS is trying to do not just in Canada but in the entire world.

#154 Kent on 06.08.13 at 4:55 pm

152 WHITEKAT –

I’ve been required by HSBC to sign a form stating I am not a US person. TD Waterhouse sent me a similar form but when I called them about it, they said it was already filled out. I have asked HSBC what business of it of them or the IRS to be asking me this question…they said since they’re registered in the US I have to answer it or they turn my info over to the IRS who can then start treating me as a US person.

For the record, I am not a US person. I did live in the states as a child over forty years ago but haven’t even crossed the border in twenty.

#155 Kent on 06.08.13 at 5:19 pm

Here’s what you get in Windsor for that price:

http://www.realtor.ca/propertyDetails.aspx?propertyId=13020846&PidKey=1943430809

Again, I’d take any of the ones in Victoria over this.

#156 Forest D. Mccarthy on 06.08.13 at 8:46 pm

“As Canadaís millionaire club swells in size, inventory will play an increasing role in future, as the existing upper end housing stock struggles to keep pace with growing demand in central core areas,” says Re/Max. It says new construction, infill developments and renovations are helping fill the void to some extent and driving up prices. “The building activity is also serving to create new prime areas that were once considered high-end peripherals, as well as in suburban communities,” says Re/Max.

#157 Mr Buyer on 06.09.13 at 9:24 am

#125 Smoking Man on 06.07.13 at 4:50 pm
#112 Mr Buyer on 06.07.13 at 2:54 pm

Testing is a filter designed to separate those that will obey.
…………………………………………………………..
The only response I have to that assertion is that has been your story and I observe your continued loyalty to it.

#158 whitekat on 06.09.13 at 7:14 pm

#153 Kent,

Interesting. Just curious, you said you lived in the US as a child. Were you born there?

If you are interested in finding out more about what is going on with FATCA(deemed the worst law no one has ever heard of) check out issacbrocksociety.ca. You wont regret it. It makes for a fascinating read. I go by whitekat there, look forward to hearing from you.