Realtors

BEAR modified

She thought there’d be a bidding war. And why not? That’s exactly what the real estate agent told her. “You’d better make this your best shot because there’s gonna be a lot of competition.”

So she did. After all, it was the perfect house – worth more than the asking price to her. But how much more?

In the end, she bid almost a hundred thousand over, just to be safe. And in the end, hers was the only offer. None other materialized. Perhaps none ever existed. Just phantoms, or a cruel ruse.

No telling how many people have paid too much, or how much more money has been mortgaged, due to the lies some realtors routinely tell. Bidding wars that erupt occasionally in Vancouver and Calgary, and are ubiquitous in certain Toronto price ranges, have been the breeding grounds for professional misconduct. After all, the temptation in a commission-driven business, in this environment, has been huge. At times, irresistible.

Typically suitors for a property are told to ‘register’ their bids, and to do so by a specified hour on the day of conflict. That ‘registration’ is legally meaningless – it’s just the seller’s agent assuming total control of the process for maximum psychological terror. Bidders are often given these instructions: ‘This is a hot property, and many people are desperate to secure it. We expect multiple bids, therefore make the first offer your absolute best shot. There will not be a second chance. We need a certified cheque up front, and $100,000 would be appropriate.’ Scary, right? Do you offer 5% above list, or 40% over? And do you have a hundred grand in your chequing account today?

Of course, nobody sees all those breathless offers except the seller and the listing agent. In practice, there’s no verification they even exist; no way of knowing how your offer stacked up against the competition. It’s a totally blind auction in which you’re left to bid against nothing but blackness. It’s a process completely open to manipulation and abuse, which should be illegal.

And now it is. Kind of.

Already it’s illegal in Ontario for a realtor to consider any offer which is not in writing. But now it will also be against the law to say there are competing offers in place, or expected, when they’re not actually written and in the dude’s hands. In the past the Real Estate Act has clearly required that all offers on a property be disclosed to all bidders – but without revealing the contents of them. Now any agent who tells you, or even hints, that another offer is expected, can be fined and have their ticked pulled. Nothing can be revealed unless another offer actually materializes.

Not only that, but brokers must now keep copies of all offers in case a rejected bidder smells a rat. Additionally, if you made an offer and lost the deal, you can ask the regulator to verify how many bids the sellers actually received.

So, the new rules (Bill 55) are an improvement. But they won’t stop the house horny from being idiots or the realtors from being hungry. The best possible defence against being mortally wounded in a bidding war is to not join one. You can make a bully offer if you feel feral, offering more than the asking price whenever you want and ignoring the realtor’s attempt to create an auction. Or, better, concentrate your house hunt on stale, unloved, bruised, neglected listings which have been sitting on the market because they have too much hair on them. Often properties which are mispriced end up being overlooked, even after a price cut or two. Vendors who are ‘motivated’- real estate jargon for people ready to eat the furniture – are the best kind. They expect to be screwed, so things are much easier.

By the way, Ontario has has joined the rest of the country in letting brokers and sellers truly negotiate the fee to be charged for dumping a house. In the past you had to choose between a flat fee, and a commission based on the selling price. Now it can be any combination of the two, which is great news for the low-cost, low-commission, low-service broker and bad news for the Royal LePage franchise owner.

Regardless, remember this: everywhere in the country commissions are negotiable. In a hot market no need to pay an average of 5% to sell a property. In a slow one, five points could be a bargain.

And never buy a house from a FSBO. Circumcision is less painful.

183 comments ↓

#1 rob on 12.15.13 at 8:10 pm

Will it be the same rule here in BC?

#2 Matt on 12.15.13 at 8:19 pm

For the uninitiated like me: FSBO = For Sale By Owner

#3 FTP - First Time Poster on 12.15.13 at 8:25 pm

Whats wrong with an FSBO? I’ve sold on Comfree before with no issues. Wouldn’t hesitate buying either – often times sellers and buyers are more reasonable without a parasitic realtard in the mix.

#4 Retired on 12.15.13 at 8:27 pm

About a month ago, we made an offer of $1,128,000 for a single family home at 177B Dunblaine Avenue in Toronto that was listed at $1,149,000. A minute before the deadline, the vendor signed back at $1,249,000!
I think the seller was intentionally lowered the price to attract multiple bids.
When we were the only bid that showed up, they just signed back the “real price”, which was $100,000 more.
Anyway, a month later, there was no sale.
It is now listed at $1,249,000.

#5 Ben on 12.15.13 at 8:29 pm

Anyone know a good site for stats on Montreal?

#6 Bought in the US, patiently waiting for the correction in Canuckland on 12.15.13 at 8:35 pm

I too am wondering why you stated “And never buy a house from a FSBO.”

I’m looking to learn here; if you have the time please reply.

#7 piazzi on 12.15.13 at 8:37 pm

Garth,

Could you elaborate on “And never buy a house from a FSBO”?

What are the perils and/or problems with that?

#8 World According To Garth on 12.15.13 at 8:39 pm

Respectfully……read a book. The sun’s actions and volcanic activity (of which there is allot now) makes what man does a rounding error. Climate Change is about the Govt hunt for money. That’s it and that’s all.

$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$
#267 Bottoms_Up on 12.15.13 at 8:22 pm
#247 broadway skytrain on 12.15.13 at 5:16 pm
—————————————————–
Let’s put in it simple terms that yo
u might understand: Worsening climate change (caused by human activity) can be seen as ‘volatility’, similar to the stock market. One year, no storms. The next year more storms (or more worse storms) than ever recorded. How is that so hard to understand?

#9 Tri-Guy on 12.15.13 at 8:47 pm

“In a hot market no need to pay an average of 5% to sell a property.” – G.T.

i wouldn’t pay 1% in a hot market with comfree

#10 Bottoms_Up on 12.15.13 at 8:47 pm

#241 World According to Garth on 12.15.13 at 4:40 pm
——————————————————
Glad you showed your true colours in this post. Also glad that we have universal health care so you should be able to receive enough medication for your illness.

Anyway, if you think government employees don’t pay taxes, then another way to look at it is this: any money actually entering their pocket is the ‘true’ cost for that employee. Thus, your $91,000 price tag, you’re actually getting that employee working on behalf of the government for about $50,000. Definitely a steal, as in the private sector they’d have to be paid that full $91,000.

#11 Bottoms_Up on 12.15.13 at 8:49 pm

#5 Ben on 12.15.13 at 8:29 pm
————————————–
Your one-stop shop for real estate stats in Canadian cities:

http://www.cmhc-schl.gc.ca/en/hoficlincl/homain/stda/

#12 Final on 12.15.13 at 8:50 pm

Live in YVR. Sold in 2011. I’ve been saying market is going to tank since I sold. I’ve been wrong so far. Have downpayment ready to buy again. Just went to bank and got pre-approval for 600K. I know I should wait, market will tank, be patient, but it’s hard. Talk me out of it!

#13 Renter on 12.15.13 at 8:53 pm

Don’t you feel special when you first walkin to an open house (taking offers in [email protected] 6pm) .The agents having an instant bond with only you let you know there are already many bids and that they truly can see you living in this hood. Last 3 hold offers I looked @ went 8000-22000 under . While I am knocking realtors since when is frigidaire top of the line and furnace/ac manufacture date 1985 considered newer

#14 Daisy Mae on 12.15.13 at 9:00 pm

Another wonderful blog….without you, alot of people would be creamed.

#15 AB Boxster on 12.15.13 at 9:01 pm

Garth,

I have used realtors 4 times in my life.
1. To buy our first home. Realtor was useless and we ended up finding a home ourselves.
2. To sell a home. We ended up showing the home to prospective owners ourselves as our realtor could not be bothered to show up.
3. To purchase some land. Our bid was in first but the listing agent presented another bid first. Highly unethical.
4. To purchase an acreage.

My opinion is that most agents are unnecessary and add little value to the transaction. Dual agency is a ridiculous conflict of interest and the opportunity for fraud and unethical behavior is far too high.
Plus, even if you can prove unethical behavior, the penalty to the agent is laughable, and you will still be screwed on the deal, so what is the point.

In what other consumer industry do the salesman get compensated based solely on a percentage of the value of the product for sale and not on the value of the effort.
All transactions should be FSBO, just have a good lawyer, which you need anyway and who will charge based upon services rendered rather than taking a cut of the sale price.

#16 Robbie on 12.15.13 at 9:04 pm

I’m a Realtor and I have seen a number of FSBO listings but every one of them so far has had something a bit odd about the listing. Mostly it’s that they are listed far above assessment and are often homes that didn’t sell at that price with a Realtor so now the Seller lists FSBO at the same or even higher price. Also, the listing information is sometimes significantly different from historical listing information…for example, the listed square footage is higher. I am skeptical about FSBO but they could work for some. I just think any Buyer needs to be extra careful.

#17 Paul on 12.15.13 at 9:16 pm

If you think it’s the agent that is always driving the ‘biting’ process you are mistaken, Its’ the sellers always has been always will be. They never sell/list for a fair or reasonable price compared to the comparable s. When asked what they think would be a good price it’s ALWAYS ‘more’. Guess what, no matter how much you complain about real-estate prices it won’t change till the buyers stop throwing the banks money at some hovel with shag carpet and a prehistoric roof and furnace. Then it will be the buyers when you ask them how much do you think we should offer? It will always be LESS.

#18 Bill Gable on 12.15.13 at 9:18 pm

Great post, and I learned a lot….thank you.

One of the points that I look at in Vancouver is how corrupt our system is when it comes to money laundering.

We may as well have Maytags running on street Corners.

Bankers are looking the other way and I know a few Realtors very well, and even THEY have told me some horror stories about the moral decay in the sector.

Caveat Emptor, to the MAX.

Best of the Season to my fellow Blog Dogs – and thanks for your efforts.

Our genial host? Best to your Wife, your team at Raymond James, Bandit and the Amazons….and I hope you have fun, running the Harley on the 103, to Lunenburg, in 2014. Please be safe.

#19 I'm stupid on 12.15.13 at 9:21 pm

I saw Brad Lamb this weekend at a hotel bar. My brother, being a little drunk, went up to him only to say that “I recognize you because Garth Turner made you famous”. The look on his face was priceless. We had a good laugh at his expense. The wonders of alcohol.

#20 [email protected] on 12.15.13 at 9:24 pm

This is what i have seen. No two neighboring houses will be listed for sale at the same time. One will be advised to wait until the neighbor sells. Once sold, the for sale sign appears.

Whats the deal with throwing in TVs etc, a few fancy light fixtures ?

Since when did the home owner handyman work require a premium dollar?

Also have seen expired offer come back as now acceptable but for ‘mo money in the multiple offer scenario. What happened to the other offers why weren’t they accepted.

Best advice don’t compete in a multiple offer bid. Just say not interested – make up some excuse like you dont like the color of the caulking used.

#21 Country Girl on 12.15.13 at 9:25 pm

“And never buy a house from a FSBO. Circumcision is less painful.”

I disagree. Did this more than once. Easy as pie. All you need is a good real estate lawyer.

#22 Joe Calgary on 12.15.13 at 9:28 pm

Up, up and away here in Calgary, it must be different here, jobs abundant and pay is high. And now talk of bidding wars in Calgary in Garth’s entry? And schooling us on how to buy these properties in a ‘hot market’? Starting to look like I’m gonna have pie in my face after preaching Garth’s teachings to all my friends while living in a dingy rental and watching properties get outta reach.

#23 Canned Goods and Buckshot on 12.15.13 at 9:29 pm

Again Garth with the hate on against FSBOs. Bought and sold FSBO five times. With a realtor only once. The unsatisfactory transaction was with the realtor. Unless you are still being spoon fed, most people can go the FSBO route. And save a whack.

#24 -=jwk=- on 12.15.13 at 9:31 pm

The FSBO I have seen are delusional with respect to the value of the property. You know you are wildly over price when you cant’ even get a realtor to list it for you at that price. They tend to sit on the market and dealing directly with these people is like an acid trip. No, I don’t want your furniture, and I don’t think the tacky basement bar you clearly built yourself with scrap wood adds value, thanks. Realtors are useless but are also the only thing keeping you from having to deal with a seller, so use one!

#25 T.O. Bubble Boy on 12.15.13 at 9:33 pm

The layoff parade continues through London, ON:
http://www.lfpress.com/2013/12/15/cargill-cutting-london-workers-at-chicken-processing-plant

The only difference here: the people are being replaced by machines vs. workers being replaced by cheaper Thai workers for Kellogg.

#26 T.O. Bubble Boy on 12.15.13 at 9:36 pm

And elsewhere in the world, cops go on strike (demanding higher salaries) and the inevitable crime spree begins:
http://www.nytimes.com/2013/12/10/world/americas/argentina-looting-spreads-as-police-officers-stage-strikes.html?src=rechp

#27 Sydneysider on 12.15.13 at 9:37 pm

News From Sydney, Australia (16th Dec.)

“SYDNEY hosted another huge week for auctions, with 1,389 homes going under the hammer.

Saturday’s listings totalled 1,016, setting a new single-day record, just two weeks after the previous record of 973 was set; bringing the curtain down on the biggest spring selling season in history.

Real estate agents were concerned that buyer numbers would be down however, as home hunters take a breather for the Christmas and New Year period.

Crowds on Saturday were decent, but the auction clearance rate dropped to 73.4 per cent, the lowest result since selling season kicked off in earnest at the beginning of September.

The rate was still high enough to hold off an improving Melbourne, where 66.6 per cent of 1,587 auctions achieved results.

The lower rate translated into rare negative value movement for Sydney, with home values dropping 0.3 per cent. Values are still up 0.7 per cent for the month and 14.1 per cent for 2013, well ahead of next best Perth (10 per cent).

The private treaty market surged ahead for the week, with 2,505 houses changing hands in non-auction sales. The big week saw the median house sale price jump to a new high of $725,000.”

#28 Bill Gable on 12.15.13 at 9:41 pm

#12 – FINAL.
I live in this burg – and even though it’s not really my business how you go broke – but I will have to pay part of my lolly, as CHMC goes under, because you think you are being ‘priced out of the Market.
I quoted Deutsche Bank’s chief Economist, on yesterday’s Blog Entry, by Mr. Turner…and it was a chilling quote….but as a Turnerite, I knew he was right.

“Vancouver’s Real Estate is the most overvalued in THE WORLD and will look at a 60% reduction, given time.”.

OK?

If you weren’t so young, you might also not be aware that this rainy joint got creamed in 1980-1, when prices dropped like a g, at end of every sentence out of Rob Ford’s face.

STAY RENTING. Even Bandit, Mr. Turner’s pal knows what’s coming.

Have a nice Christmas and watch all those darkened lights in the Condo Towers on False Creek and smile.

#29 Paul on 12.15.13 at 9:46 pm

AB Boxster on 12.15.13 at 9:01 pm

Garth,

I have used realtors 4 times in my life.
1. To buy our first home. Realtor was useless and we ended up finding a home ourselves.
2. To sell a home. We ended up showing the home to prospective owners ourselves as our realtor could not be bothered to show up.
3. To purchase some land. Our bid was in first but the listing agent presented another bid first. Highly unethical.
4. To purchase an acreage.

My opinion is that most agents are unnecessary and add little value to the transaction. Dual agency is a ridiculous conflict of interest and the opportunity for fraud and unethical behavior is far too high.
Plus, even if you can prove unethical behavior, the penalty to the agent is laughable, and you will still be screwed on the deal, so what is the point.

In what other consumer industry do the salesman get compensated based solely on a percentage of the value of the product for sale and not on the value of the effort.
All transactions should be FSBO, just have a good lawyer, which you need anyway and who will charge based upon services rendered rather than taking a cut of the sale price.
———————————————————-
And just how would you know the value of any property
Pull the price out of your Butt?

#30 T.O. Bubble Boy on 12.15.13 at 9:47 pm

Back on the topic of Realtors… apparently it is hard to find a condo in Milton???

http://toronto.kijiji.ca/c-real-estate-condos-for-sale-Milton-Condos-From-the-230s-www-SearchMiltonCondos-ca-W0QQAdIdZ552360495

Funny, I do a search on realtor.ca, and 27 condos magically show up.

I can also find 14 posts on kijiji.ca for “Milton Condo” (under condos for sale), and 53 results if I search on “condo” in the Real Estate for sale section of Burlington/Hamilton Craigslist.

Yep, that realtor is collecting 2.5% to essentially use Google for you.

#31 Bob Rice on 12.15.13 at 9:50 pm

#3 “Whats wrong with an FSBO? I’ve sold on Comfree before with no issues. Wouldn’t hesitate buying either – often times sellers and buyers are more reasonable without a parasitic realtard in the mix.”
_______________________________________________

Agreed… I sold my place with Comfree… we don’t need realtors… a good lawyer does all the important work.

#32 Chickenlittle on 12.15.13 at 9:50 pm

“We are accepting offers on Tuesday.”

Do agents still do this?

That would be my cue to run, not walk out of there!

#33 Bob Rice on 12.15.13 at 9:53 pm

#29 “And just how would you know the value of any property? Pull the price out of your Butt?”
_______________________________________________

It’s not hard to get comps… And if you use services like Comfree they give you the list… a lot cheaper than 2.5%

#34 45north on 12.15.13 at 9:53 pm

Final : Just went to bank and got pre-approval for 600K. I know I should wait, market will tank, be patient, but it’s hard. Talk me out of it!

ask the bank for a copy of your future mortgage. Read it.

#35 Canadian Watchdog on 12.15.13 at 9:56 pm

#14 Robbie

Also, the [FSBO]  listing information is sometimes significantly different from historical listing information

And what difference is that from a Realtor re-listing a property under a new MLS number with a new price, DOM, etc.? Who suggested that? The seller?

09/01/11  E2734378   91 KINGSWOOD RD  $1,590,000
03/01/12  E2465853  91 KINGSWOOD RD  $1,699,000
04/01/12  E2383010  91 KINGSWOOD RD  $1,999,000
05/01/12  E2095893   91 KINGSWOOD RD  $1,050,000
05/01/12  E2400392  91 KINGSWOOD RD  $1,799,000
02/01/13  E2595341   91 KINGSWOOD RD  $1,649,000
08/01/13  E2785802   91 KINGSWOOD RD  $1,589,900
      
01/01/11  C2764412   336 HOLLYWOOD AVE  $1,258,000
03/01/11  C2428392  336 HOLLYWOOD AVE  $1,318,000
04/01/11  C2207871   336 HOLLYWOOD AVE  $1,300,000
05/01/11  C2693210   336 HOLLYWOOD AVE  $1,348,000
01/01/12  C2207871   336 HOLLYWOOD AVE  $1,050,000
02/01/12  C2267823  336 HOLLYWOOD AVE  $1,288,800
05/01/12  C2595041   336 HOLLYWOOD AVE  $1,380,000
06/01/12  C2785091   336 HOLLYWOOD AVE  $1,258,000
07/01/12  C2785091   336 HOLLYWOOD AVE  $1,098,000
11/01/13  C2267823  336 HOLLYWOOD AVE  $1,098,000

09/01/11  W2428170 11 NORTH  $2,195,000
02/01/12  W2765061  11 NORTH  $2,198,000 (2.1M honey. Yes I'm sure)
02/01/13  W2059160  11 NORTH  $1,690,000 (Screw that. Let's start a bidding war!)
03/01/13  W2791945  11 NORTH  $3,500,000 (No pull that offer. Let's go 3.5M baby!)
04/01/13  W2765061  11 NORTH  $2,150,000 (2.1M?)
09/01/13  W2428170  11 NORTH  $2,395,000 (2.4M? Where are the bidders?)

#36 broadway skytrain on 12.15.13 at 9:57 pm

You miss-spelled “fradulent”. It’s “fraudulent”.
——————————-
priceless comrade, just f’ing priceless.

*miss-spelled* HAHAHAHAHAHAHAHAHAHAHAH breathe HAHAHAHAHAHAHAHAHAHAHAH\

commie police need not follow rules!!!!

i trust you are posting from cuba or NK right?

#37 Paul on 12.15.13 at 9:57 pm

#30 T.O. Bubble Boy on 12.15.13 at 9:47 pm

Back on the topic of Realtors… apparently it is hard to find a condo in Milton???

http://toronto.kijiji.ca/c-real-estate-condos-for-sale-Milton-Condos-From-the-230s-www-SearchMiltonCondos-ca-W0QQAdIdZ55236049
I can also find 14 posts on kijiji.ca for “Milton Condo” (under condos for sale), and 53 results if I search on “condo” in the Real Estate for sale section of Burlington/Hamilton Craigslist.

Yep, that realtor is collecting 2.5% to essentially use Google for
———————————————————-
Funny, I do a search on realtor.ca, and 27 condos magically show up.

Who do you think pays for M.L.S .CA for you you yo use
What a joke

#38 broadway skytrain on 12.15.13 at 10:03 pm

#12 Final on 12.15.13 at 8:50 pm
Live in YVR. Sold in 2011. I’ve been saying market is going to tank since I sold. I’ve been wrong so far. Have downpayment ready to buy again. Just went to bank and got pre-approval for 600K. I know I should wait, market will tank, be patient, but it’s hard. Talk me out of it!
—————————–
if you are looking west of willingdon or n, shore there will be no tanking – far flung burbs is your only hope.

pace of infills near comm dr is higher every year (must have seen 20 on our short walk tonight)

#39 eddy on 12.15.13 at 10:08 pm

The non existent offer. If the agent says there is
another offer, and then it doesn’t materialize, and everyone is informed before presentation, there is no crime. Forgery, uttering etc is illegal. What about the spec offer?
One offer is registered, Listing Agent calls a ‘contact’ (spec)
‘give me an offer of 75% of Value, conditional on financing, inspection, your wife’s approval and the sale of your time share condo’

The agent tells the first offer ‘we have a second offer, make yours your best’
No mater how weak the spec offer, it’s still a signed , legal offer and can help inflate the other offers, no ethics, but no crime.

#40 HD on 12.15.13 at 10:12 pm

#257 World According To Garth on 12.15.13 at 6:33 pm

“Govts do not earn income and derive their income from private citizens and private companies therefore by definition public employees only recieve taxes as salary but do not pay taxes.

Think about it. If everyone worked for the govt WHERE would the money come from to pay everyone? Bizarre indeed.”

Riiiight. Makes total sense.

My sincere apologies.

Best,

HD

#41 broadway skytrain on 12.15.13 at 10:14 pm

#25 T.O. Bubble Boy on 12.15.13 at 9:33 pm
The layoff parade continues through London, ON:
http://www.lfpress.com/2013/12/15/cargill-cutting-london-workers-at-chicken-processing-plant

———————-
wow , blast from the past! i did my engineering grad year project at that very plant back in 89. i can still remember the view from the roof as i did tests of hvac units with an anemometer and mj smoke.

bottom line – if you can’t design/install/service/repair/maintain all these wonderful new machines that don’t join unions or cause WCB cliams you are well and truly SCREWED.

engineers shall inherit the earth….as was written in the prophecies, as it shall be.

#42 broadway skytrain on 12.15.13 at 10:20 pm

#25 T.O. Bubble Boy on 12.15.13 at 9:33 pm
The only difference here: the people are being replaced by machines vs. workers being replaced by cheaper Thai workers for Kellogg.
——————————
just one other thing – thai workers make cereal for asia, not here – the newer NON UNION bellville plant will pick up much of the london slack

inside a cereal box is 80% air – who is going to fly boxes of air across the pacific?

#43 conan on 12.15.13 at 10:24 pm

Re: #15 “In what other consumer industry do the salesman get compensated based solely on a percentage of the value of the product for sale and not on the value of the effort”.

Every private industry sales type pay-check is based on the size of the deal. They all work that way and so they should.

The big pay days cover the expense of servicing the smaller sales. It evens everything out and it works.

In any sales career if you can not get the odd big sale you will not survive.

#44 Mark on 12.15.13 at 10:33 pm

“Up, up and away here in Calgary”

Do you actually live in Calgary???

#45 Paul on 12.15.13 at 10:37 pm

Nothing wrong with FSBO. Like anything else, buyer beware. If you know the market value in the area, there is no reason why you can’t buy FSBO.

Realtors bring less and less value to the game as time goes on. Let’s see, let me work hard to get the listing and then sit on my ass and have someone else sell it. Keep doing that and I can actually make a living without doing any work.

With the internet tools available these days, an educated buyer or seller that use FSBO very effectively.

#46 baddog on 12.15.13 at 10:37 pm

I also disagree with you on FSBO Garth. I have done it and it was easy. You need 3 things. A good home inspector, a professional appraiser and a real estate lawyer. All work for a flat fee and will give you the straight goods. I would not recommend it for virgins though. You do need to have at least some experience.

#47 Smoking Man on 12.15.13 at 10:41 pm

What is wealth.

Is it a big house,fancy cars, and vacations. No debt, a trophy wife decked out in diamonds and pearls.

Nope, not even close.

Wealth is imagination.

The ability to fool ones self no matter circumstance that this is so cool, I’m so fricken lucky and believe it.

Things that money buys has a shelf life. Money is not limitless. My family needs it, they don’t have my good fortune and mind.

At dinner tonight I had family on the floor laughing guts out on a made up story of a fat girl on the go train making all kinds of crazy faces before she pushes out a nuclear fart.

A vivid imagination is the only thing you need to have a happy and prosperous life.

This is a money blog, everyone obsessed with it.

Money is poverty and prison.

My book is going to be so cool. Pumping out exceperts on my blod between now and realese date. Feb 1

#48 re: BLACKSHEEP Inquires, on 12.15.13 at 10:45 pm

This is a direct order to Immediately cease all questioning and or interactions with the persona known as “The Smoking Man”. This operation has achieved full physiological embedment with the targeted, G.F. posting public and will not be jeopardized.

The Voting Man Project has been given an X- level priority, and as such, deemed critical to the maintenance of democratic cohesion in our fine nation.

As a citizen in good standing, we assume no further action will be required.

You have been warned.

THE MACHINE

#49 Marco Polo on 12.15.13 at 10:46 pm

I laugh at an earlier post claiming you need a realtor. You especially don’t need a realtor to tell you what to bid on a home. A resale home, like a resale tractor or boat, is worth only what a potential bidder is willing to pay. If you use a home inspector and lawyer you trust, and buy the house you want for the price you want, why would you need to line someone’s pockets with commission?

By the way, some yachts and aircraft sell for more than homes, and neither use a real estate agent to sell them.

A blind man could see that realtors are very worried about becoming outmoded and replaced by the internet, and made redundant. This is seen in their ads.

I have used a realtor to buy and then sell a home, it was good value both times, and I negotiated an exclusive listing with him, and a low fixed comission. Paying him was well worth it, as I was already working at a higher paying job in another town.

I think what Garth means is that both FSBO listings and Comfree, Property Guys, usually exhibit some of the more overpriced homes, with sellers usually looking to fund their retirement, or move up to a more expensive home. Usually unmotivated sellers, and not the stale listings you should be looking for.

#50 Millmech on 12.15.13 at 10:47 pm

At least at the cargil plant they will need to hire more tradesmen.The plant I’m at is going to be short ten in two years due to retirement,average salary is $100,000(non-union),can’t find anyone to replace them.Get a trade, skill security,I have two and am working on my third, never been out if work in twent five years.GF got laid off and got a trade makes 80,000 year as a trades women as a second year apprentice.

#51 ILoveCharts on 12.15.13 at 10:48 pm

I would be very interested to know what folks think of Burke Mountain.
http://www.coquitlam.ca/planning-and-development/community-plans/northeast.aspx

It’s a monstrous development with plans to house 24,000 to 30,000 people. A lot of it will be new single family homes but there are also MURBs and townhouses.
It seems like most or all of the development is occurring in area that used to be forest (or still is forest.)

#52 broadway skytrain on 12.15.13 at 10:57 pm

#43 conan on 12.15.13 at 10:24 pm
Re: #15 “In what other consumer industry do the salesman get compensated based solely on a percentage of the value of the product for sale and not on the value of the effort”.
————————–
all of them ?

conan knows, and #15 never worked in sales. obviously.

#53 Canadian Watchdog on 12.15.13 at 11:04 pm

Ok the charts everybody loves. Toronto detached average price by area (12 month moving averages)

East End

West End

Central

Central, East and West

All looks great right? Not really, because what's really driving average prices higher is lower sales.

East End

West End

Central

Central, East and West

Juxtapose those charts and you'll figure it out quickly.

#54 Ben on 12.15.13 at 11:05 pm

Bottoms_up – thanks, very helpful. Any other recommendations for trusted parsing of this data?

#55 don on 12.15.13 at 11:13 pm

50 millmech. Sorry dude when the bubble blows it will take a lot of trades with them. We built our home in 1996 and had many builders low balling each other for work. When the credit reverts to the mean the trades will suffer.

#56 Hollywood on 12.15.13 at 11:15 pm

The average person gets very curious on the house situation in Canada as it is in the media on a continuous basis. Anyways, I know a person in Edmonton who works for the major bank (Royal) who has done mortgages for the last 20 years. He mentioned in discussion that there is a definite lack of house sales and he considered this year very slow. Houses are sitting on the market and not moving. That’s one person I know. Plus I talked to a relative who oversees 3 branches in Edmonton for a competitor bank. She mentioned, sales are slow in houses as well. All, I’m saying the “papers/media” claim AB’s economy is booming and house sales are “brisk”, but when you actually talk to people involved you get a different story. I’ll pick the people I know who have the facts for more reliable information. Their reasons, houses are too expensive and unaffordable for the average person. She mentioned I bought my house in 1999 for 125k and it is 40 years old – today it is worth 450k. Plus people with very good incomes i.e. 100k plus are finding house prices beyond affordable. Interesting times in Canada – house prices remind me of the “tech bubble” that got pricked in Mar 2000.

#57 broadway skytrain on 12.15.13 at 11:16 pm

270 Andrew Woburn on 12.15.13 at 10:39 pm

Would that be sodium chloride, aka salt?
————————–
close, but more likely calcium chloride, aka the stuff we have been spreading on roads for decades
http://www.homehardware.ca/en/rec/index.htm/Outdoor-Living/Yard-Maintenance/Snow-Removal-Aids/Ice-Snow-Melting/Ice-Melt/20kg-Calcium-Chloride/_/N-ntlmj/R-I5548231

#58 Entrepreneur on 12.15.13 at 11:19 pm

Everybody pays taxes.

With that aside, what I have been taught was the private sector creates money from producing but not so for the government.
The private sector is the engine behind the economy.

What really upsets me when I was in business I had to account every penny with paperwork; politicians are allowed $5000. (probably more now) and do not have to have any paperwork. Hope I am wrong about this, if not, it should be like that for the private sector. We are the money producers…the smoking engine!

#59 Smoking Man on 12.15.13 at 11:22 pm

#48 re: BLACKSHEEP Inquires, on 12.15.13 at 10:45 pm

You just did what your telling everyone not to do.

Damn had to go to UOG to see what cohesion and embodiment meet..

I wish I was Chinese, their typed words are pics, I would be a professor in that town.

Dyslexics see pics.

#60 broadway skytrain on 12.15.13 at 11:25 pm

#51 ILoveCharts on 12.15.13 at 10:48 pm
I would be very interested to know what folks think of Burke Mountain.
http://www.coquitlam.ca/planning-and-development/community-plans/northeast.aspx

It’s a monstrous development with plans to house 24,000 to 30,000 people.
————————————–
it will sell and fill up with people who detest the horrid commute and wish they could be living in the core

if there are endless bodies to fill new distant hinterland housing there is no hope of prices in the core falling much, say 10%.

#61 Victoria - the Original on 12.15.13 at 11:26 pm

I went Christmas shopping today (in the most popular mall in Victoria). They had hired all these people to control traffic with stop signs, slow etc. Well, most of them were just sitting around having smoke. Parking – super easy. Walking around the mall – pleasant. Loads of stuff.

I remember Christmas past that mall being bedlam 3 weeks before Christmas. I see things are changing. Maybe more people are buying online but I have heard that people are not buying as much this year for their kids. We are certainly bringing it down a notch – actually a couple of notches.

#62 broadway skytrain on 12.15.13 at 11:30 pm

#55 don on 12.15.13 at 11:13 pm
50 millmech. Sorry dude when the bubble blows it will take a lot of trades with them. We built our home in 1996 and had many builders low balling each other for work. When the credit reverts to the mean the trades will suffer.
————————–
good point that trades in construction have more risk than a power boiler operator or instrument tech or millwright or aircraft mech

most trades are not in const. but a lot of tradesmen are.
avoid this area and you will be busy forever.

#63 Smoking Man on 12.15.13 at 11:39 pm

Do you dogs know why you want money so bad.

You want to be judged in a positive light, you want respect with out saying a word, your things too do the talking for you.

The same way you suck up, you want that. You have been trained by slave masters to think that way.

Me, I would rather talk and type.

And as far as being judged.

Middle Finger.

#64 TheCatFoodLady on 12.15.13 at 11:40 pm

FSBO – as mentioned can work for or against you. If I was doing FSBO as a seller, here are a few thigns I’d keep in mind:

I need decent comps & I’d check not just my immediate neighbourhood but truly comparable areas close by. *I* would get an inspection before deciding on a price, especially when a market isn’t so hot. Buyers, (smart ones), will have them done anyway – as a seller, I don’t want surprises. I need to be available for calls inquiring about the place & appointments. If I want the place to sell quickly – get the greed out. I’m thinking I’m using FSBO at least in part to cut realtor costs, why not throw some of that back at the potential buyers in the way of a bit of a price cut?

As a buyer, FSBO can be good if your seller knows what they’re doing but a complete waste of time if they don’t. Imagine an elderly couple who’ve been in their home 40 years. They’ve raised a family there, love it but it’s too much for them and/or they need the money. They need to sell but may not want to.

It’s very difficult to remain objective about your own place – after all, it’s HOME & there are memories in every corner. Sellers have to understand that emotional value does not equal cash value & sweat equity put into a place 20 years ago may not only not add to real equity but take away from it. That ‘cosy’ family room you built in the basement with pine paneled everything may make you feel comfy but give potential buyers the shudders. Your ‘artistic’ wallpaper choices? Potentially a real turnoff.

A good realtor casts an impartial eye. No matter what you think of them, experienced realtors have seen lots of homes & lots of buyers. They know what breathless wanna be homies are looking for. You & I may gag over the gaggle of granite but if that’s what buyers want – that’s what’s going to fetch top dollar. If they recommend a neutral paint job & decluttering – it’s not because they’re looking to fill your spare hours.

FSBO sellers often try to coax you to take some of the furniture or offer to sell it to you. “But it’s good furniture!” Maybe but everyone has their own idea of good or tasteful. I’ve heard a seller indignantly proclaim: “I want to get SOME money back for it!” That seller had used that furniture 25+ years already – what more value did he need to extract? I also heard the RE agent tell a potential worried buyer not to worry about the furniture. He wanted some of the items but not at the prices the seller wanted. He scarfed them up later when the furniture went on sale at an online auction site. Paid 25% of what the seller wanted. When the seller found out – he went ballistic. “I got screwed!” Nope. Its jaw dropping how little you can pay for all manner of furniture, stuff & knick knacks if you shop online auction sites. A lot of stuff – nobody wants it anymore.

I’d think about using FSBO but very, very carefully & not offer a penny more than what I thought a place was worth & ensuring it was within my range of affordability.

#65 dutch4505 on 12.15.13 at 11:48 pm

realtors…3 days in Canada…4th day realtor’s lic from Sauder Business School of Vancouver BC

#66 Ralph Cramdown on 12.15.13 at 11:56 pm

Well, the Ontario Government has introduced updates to REBBA. Garth has summarized, but fill details here:
http://www.ontla.on.ca/web/bills/bills_detail.do?locale=en&Intranet=&BillID=2776

Regarding written offers, effectively nothing has changed. There’s no electronic central registry of the sort that some grade 9 students could whip up in a weekend for a few thou, so crooked brokers will have lots of time to execute a few offers between the time OREA calls and when the inspector shows up (or are they allowed to fax them in?) Remember guys, use a few different pens, and do one or two with your left hand.

But here’s the oddball amendment:
“If there is no agreement as to the amount of the commission or other remuneration, the rate of it or other basis for determining it shall be that generally prevailing in the community where the real estate is located.”

So an agent can now offer to sell your home, write no paper as to what it’ll cost you, and then demand 5% on sale? What a business! I can see this being very useful to unscrupulous or lazy/sloppy agents, but have trouble envisioning a situation where a competent, honest agent would need to rely on it. Thoughts? Anyone know of any cases?

#67 Bottoms_Up on 12.16.13 at 12:07 am

#8 World According To Garth on 12.15.13 at 8:39 pm
————————————————-
Because it is written, especially in a book, makes it so?

#68 HDJ on 12.16.13 at 12:16 am

Add me to the growing FSBO list. Have done it twice without difficulty and saved quite a few thousand each time. If the property has appeal, all you need is a lawyer.

#69 Bo Xilai on 12.16.13 at 12:25 am

The best way to win a bidding war is to not to participate in one…

#70 Average Joe on 12.16.13 at 12:34 am

#29
Any person who wants to sell a property privately can
do so with a bit of effort.
To research the prices of properties sold, all you have to do is watch comparable priced homes in the neighbourhood and
find out what has sold and for what price. That information is open to the public at the tax offices and many real estate people will send out the info for solds in the areas to you if you ask. They will email it to you weekly. No big deal to research housing prices in an area and price a property that is for sale to compete with others on the market. We sold a property with Comfree, saved several thousand in fees, priced the property very competitively. Did our own open houses and placed our own ads in the paper. Worked great. We visited a few open houses to fairly price our property and looked over all comparable solds in area. The buyer saved and so do we, big time. Many people think that they can’t do things like sell their own homes or import vehicles or set up their own trading accounts and learn to trade stocks. All the info is available on the internet.
In books, from blogs like this. How about holding your own mortgage for a rental in your self directed RRSP and paying yourself 6.3% interest? Plus the interest on rentals is tax deductible so claim it in the higher tax bracket spouses name. People don’t have to depend on realtors, bankers, importers to do things. Perhaps all we need is to have a decent accountant.
Realtors want people to think it is complicated, they have you convinced that you have to pull pricing info out of ones butt.
Due diligence and some research and perhaps using a service like Comfree or property guys will sell a home and save thousands. Only thing that needs to be pulled out of the butt… is peoples heads when they think they can’t do what is really not that hard.

#71 Renter's Revenge! on 12.16.13 at 12:35 am

Why the confusion over public/private workers? Producers get paid by consumers when they sell their products. Consumers pay producers when they buy their products. Money goes around in a circle. Health care is a service. National defence is a service. Car maintenance is a service. They all produce value and they all cost money. What does it matter whether they come from public or private employees? If everyone worked for the government, income taxes would be 100% and everything would be free. In effect, your taxes, spending and saving are a 100% “tax” on your income. It all adds up. This isn’t mind-blowing stuff, people.

#72 Musty Basement Dweller on 12.16.13 at 12:44 am

The balls award goes to Garth tonight for taking a shot at FSBO in this basement dwelling frugal community living on his blog.

2nd place to the realtors on here that fess up to actually being realtors.

Love it all.

#73 Porsche on 12.16.13 at 1:00 am

I sold two houses FSBO? Worked slick, on one of them we even used the same lawyer.

I undercut the market and put more in my pocket and the buyer thought he got a good deal.

#74 not 1st on 12.16.13 at 1:04 am

#244 not 1st on 12.15.13 at 4:52 pm

And here we all thought you were so smart. — Garth

Yup, got real smart when I stopped trying to be a landlord. Wouldn’t wish it on my worst enemy.

90% renters are deadbeats and losers. People who never bought never had the means to anyway. People who sell their nice detached home home to rent a wood and glue condo to fund their retirement are just as dumb and poor at money management.

#75 daniel on 12.16.13 at 1:05 am

FSBO??? Like selling or buying a house was some hyper-complex or magical thing that only the “initiated” were worthy enough. Get real. Playing right into the hands of the RA cartel.

#76 Jeremy on 12.16.13 at 1:05 am

Garth, your last sentence begs the question, what’s wrong with FSBO (for sale by owner)?

#77 daniel on 12.16.13 at 1:07 am

oops meant RE cartel.

#78 AB Boxster on 12.16.13 at 1:10 am

#52 broadway skytrain

You are correct. Never been a salesman. Proud not to have ever been.
Made my money providing a good service for good wage.
Salesman who are compensated ‘solely’ on commission will say anything and do anything to make the sale. Ethics be damned.
(Financial Planner, realtor, insurance agent, car salesman)
Problem for them is that all the information is readily available on-line.
Who needs them anymore.

#79 Bobby on 12.16.13 at 1:12 am

Looked at a condo here in Victoria over a month ago. Unit was tired and showed poorly and had been on the market forever. The selling agent redefined useless, and offered very little information. Kept saying make an offer then get the information. As I was walking away she said they were expecting an offer the next day. I queried, why is it a condo sits on the market for months but just as I’m looking at it there is always an offer coming. She tersely responded she didn’t lie. I don’t know where they get these clowns.

#80 FSBO on 12.16.13 at 2:10 am

The seller wants to keep the realtor’s commission.
The buyer wants the commission to be a discount.

If it’s fair, it’s a 2.5 % bonus/discount to the seller/buyer and both think they got ripped off.

Of course it won’t be fair.

OTOH, a disinterested illiterate dropout who knows SFA about the property and specializes in scamming people won’t be writing your MLS listing.

#81 Derek R on 12.16.13 at 2:56 am

#58 Entrepreneur on 12.15.13 at 11:19 pm wrote:
With that aside, what I have been taught was the private sector creates money from producing but not so for the government.

Really? The private sector creates goods and services. But it’s not allowed to create money. Credit maybe, but not money. The government is the only sector allowed to create money. If the private sector wants money it has to give the government goods and services in order to get it.

It’s a bit like steak. The only people who create steak are farmers. If the rest of us want steak, we have to give the farmers money (or goods and services) in order to get it. We can’t create it directly.

Hope I am wrong about this, if not, it should be like that for the private sector. We are the money producers…the smoking engine!

You aren’t the money producers; you are the goods and services producers. That’s much better.

#82 John Prine on 12.16.13 at 3:03 am

#21 Country Girl on 12.15.13 at 9:25 pm
“And never buy a house from a FSBO. Circumcision is less painful.”

I disagree. Did this more than once. Easy as pie. All you need is a good real estate lawyer.
_____________________________________________

We sold a house in 1989 privately and bought another a month later. Both advertised in the local paper. Had a notary take care of everything, worked well as both properties were aggressively priced .

When we went to sell again in 2011 it was a different story, prices were up but so was buyer paranoia. We tried for 6 months ourselves and it seemed every prospective buyer had problems selling their own home or had financing difficulties. Had 1% reality people trying to get our listing but they were very “flakey” and we didn’t feel good about their methods.

Bottom line was we did list with Royal LePage and within a month we had sold the Okanagan house to people from Ottawa. We wanted to get on with our lives and without them I’m pretty sure we wouldn’t have got our price.

We are looking for another home now and find that the FSBO’s are usually overpriced and talking money or even viewing is difficult. We are staying with realtors in this market.

#83 Frustrated Kiwi on 12.16.13 at 3:19 am

#12 Final
FWIW, from a disinterested outside observer, I’d put a 75% chance on Vancouver having topped out already (condos almost certainly have). That said, housing corrections tend to go slowly (look at Victoria for an example) so don’t expect more than a 5% drop next year, maybe none (just a correction in real rather than nominal terms). If you can’t stay away from buying for at least three years, five would be better, and you’re not violating Garth’s rule of 90, then you may as well go ahead and buy (modulo the advice above and on an earlier post from Garth) – it will at least reduce your stress level once it’s done.

#84 Blacksheep on 12.16.13 at 3:25 am

Smoking man,

Maybe if I used the intended psychological vs the spell checked, physiological?

By the way, fine work emoting vulnerability in your character. The dogs eat it up.

#85 Life's a supermartingale on 12.16.13 at 3:30 am

A good auction – one that is well game-theoretically founded – aims to get the reservation price from each participant. That is, all information gets brought out from all parties. From a market efficiency standpoint, we want the asset to go to the individual who wants it the most, and we want him to pay what he thinks it’s worth. If the advice from your realtor is to bid above asking to prevent a bidding war, you are free to ignore it. On the other hand, if you accept the advice, it must be that you value the house by at least that much, and it is completely fair for the process to elicit that information from you. We want incentive compatibility (or at least truth-telling as a Nash equilibrium of the auction). A perfectly fair auction would elicit the buyer’s true valuation of the property, regardless of what others think.

Most of this regulation is unnecessary and further entrenches rent seeking behaviour from “licenced professionals”. Bad realtors will go out of business – we really don’t need the nanny state policing the process of how two mutual interest parties come to reach a deal.

#86 TiV on 12.16.13 at 3:44 am

New custom builds tend to get sold via the following process: list over market, and hope for a bid. After two weeks, cancel, wait, and drop the price by $25k to $50k, and re-list. Repeat until house is sold. Watched a real estate agent sell her own home once, and she followed the same process. These are experts in sales, so I expect they’re following the right process to maximize average sale price. Just because an “unloved” home was originally listed above market and has now been re-listed does not automatically mean it is “languishing” or is a good deal, it seems to me.

If you can, try to find out as much as possible about the selling agent. If local realtors have a history of mis-trust for the selling agent … be wary.

#87 JustTryingToProtectEquity on 12.16.13 at 4:09 am

We listed our house at $949,000.00 in June of 2012.
Our intention was to sell it before Finance Minester, Jim Flaherty, introduced the 20% down on any homes over $1 million.

Yes, we were shooting for $1 million.

22 couples saw our house (none of them Asian).

But only 1 couple put in an offer. They originally offerered $155,000.00.

Our realtor (after discussing it with their realtor) told us
to hold off.

They came back with another offer. $165,000.00.

Again, our realtor (in discussing it with their realtor) told us to hold off.

“You’re looking for a million, this is a seller’s market. Stand your ground.”

$975,000.00

We sold.

A house we had bought 16 years earlier for $325,000.00.

To this day, we can’t understand why the people putting an offer on our home kept bidding up. There were no other people bidding.

Madness.

#88 JustTryingToProtectEquity on 12.16.13 at 4:13 am

Sorry, the $155,000.00 was meant to be $955,000.00.
Typing on an iPhone after to many Xmas party beers.

All the best to everybody! Enjoy your holidays!

#89 Mike on 12.16.13 at 5:53 am

“Never buy a house from a FSBO”

This is completely alarmist, and sounds
like it belongs in a ReMax article. I wouldn’t
be surprised if somewhere you’re being
compensated to still promote using an agent
even though your blog flogs them at the same time.

I know plenty of people who have bought
and sold great properties on their own with great success.
In this manner, buyers and sellers interact
directly without the conflict of interest
inherent with a realtor.

Selling a house isn’t rocket
science and an agent isn’t needed.
The only people telling us otherwise are realtors
and for some odd reason, you.

Everything your blog is about should lead
to supporting FSBO.

Teaching readers how compromised agents are
and how the entire industry is built on sand yet
somehow FSBO is not advised.

I smell a rat.

Then you are a fool. Most FSBO listings are to achieve one goal: being cheap. That usually mean you end up buying an over-valued property without any guarantee of adequate disclosure, no valid mechanism for redress in the future should issues crop up and the potential for serious legal issues in the event of a poorly-worded conditional or mishandled offer. FSBO has obvious advantages for sellers. The disadvantages for buyers are legion. Hence, my advice never to buy FSBO. — Garth

#90 Detalumis on 12.16.13 at 6:47 am

I sold my last house FSBO, it sold in one day. My neighbour sold his the same way and then I used his sign and stuck it on my lawn. All I got for the next week was a flurry of calls from agents berating me and telling me that I priced it too low and should have used them. Buyers and sellers are well aware of what is a reasonable price in a particular area. It’s very easy to do, each side just needs a good real estate lawyer to draw up the contracts.

#91 Cow Man on 12.16.13 at 8:01 am

# 15
Another “profession” based on commission that increases revenue to agent, not based on effort, is Life Insurance. Believe me the one I dealt with is worse than any Real Estate agent.

#92 X on 12.16.13 at 8:51 am

re #4 – could you imagine if the grocery store did that after you loaded your cart up and go to the till to mark the prices up. This practice should be restricted as well.

I think it is good that the realtors have to keep copies of all registered offers, but do they get downloaded into a database or could they simply be fabricated upon request.

#93 Catalyst on 12.16.13 at 9:10 am

I would like to see government intervene here. They should create a website and make it law that all properties must be listed on the site and free to access for everyone. Make it queryable and easy to pull data and keep a record of all sales.

This will force transparency and force realtors to bring more value to the transaction rather than a gatekeeper of listing information.

#94 recharts on 12.16.13 at 9:35 am

#86 JustTryingToProtectEquity on 12.16.13 at 4:09 am
We listed our house at $949,000.00 in June of 2012.
Our intention was to sell it before Finance Minester, Jim Flaherty, introduced the 20% down on any homes over $1 million.

I call this bullshit
Address for this sale?

#95 maxx on 12.16.13 at 9:49 am

#16 Robbie on 12.15.13 at 9:04 pm

Over the years I have bought and sold a number of properties, both privately and with realtors.

IMHO, realtors do not have a patent on honesty nor on accurate presentation of facts. I have seen, time and again, realtors who engage in and enjoy the game of manipulating buyers into bidding wars.

Whether buying through a FSBO listing or transacting through a realtor, the risk is no different. The sales process being what it is, the selling party will ALWAYS paint lipstick on the pig.

I would do as much due diligence with a realtor as with FSBO.

Realtors deserve no more trust than a private seller. None. I would always be “extra careful” with any selling party.

Every prospective buyer should be “skeptical”, whether having to deal with a realtor or FSBO listing.

#96 Ray Skunk on 12.16.13 at 9:52 am

Been on both sides of this fence.

Selling my first condo, my agent wanted to list it for $299k. Wasn’t underpriced, we genuinely felt it was worth that from comparables. We staged it, I moved out for a week and left it free to view with offers by the end. Five offers came in; one at 295k, one at 299k, two at 305k and one at 326k. I felt better about taking the $326k offer when I subsequently saw the place for rent on MLS for a ridiculous $1850/mo.

The house that was purchased thereafter was listed at $429k. It was the second time in three months it was listed (fell through?), and we had seen it previously when sounding out the local market before becoming serious buyers. When it came up again, we jumped on it. It came on the market Saturday, we viewed it Sunday, and had an offer registered first thing Monday for $415k – valid until end of day. Miracle of miracles – there was another offer posted around midday! What are the chances, eh? Anyway, we threw in an offer of $1k over asking not wanting to get carried away. We won. Fancy that! The selling agent tried to give us the warm fuzzies that although our bid was lower, the sellers preferred our offer. Yeah, ok…

Quick note about my experiences with FSBO: firstly, don’t ever expect your realtor to take you there or discuss that property. The cartel is a closed circle and protects itself.

Secondly – and I may be generalizing here – but the FSBO crowd have shown themselves to be the penny-pinching, tea-bag-reusing, uber-tight sellers you’d expect to have a hard time trying to reason with. Instead of pricing their homes in the right ball park and knocking one or two % to throw a little of their commission savings back at the buyer to get the place shifted, they want to have their cake and eat it. Overpriced from the get-go (seemingly going by the last listing on the street and slapping $20k on because, well, that’s what the market is like, right?), and refusing point blank to negotiate. After three months the comfree sign is down and the Re/Max one is up. That’s my experience, anyway.

#97 recharts on 12.16.13 at 9:58 am

Here is an interesting one regarding home inspections standards:

New section 17.1 of the Act requires the Corporation to make available on its website any guideline or checklist that an inspector uses to conduct initial or periodic inspections. New section 17.2 of the Act requires the Corporation to give authorization holders the guideline or checklist that will be used for the purpose of any inspection other than initial or periodic inspections.

http://www.ontla.on.ca/web/bills/bills_detail.do?locale=en&Intranet=&BillID=2782

and here is the act

http://www.e-laws.gov.on.ca/html/statutes/english/elaws_statutes_00t16_e.htm#BK47

So basically before hiring the services of an inspector one should ask him about the above mentioned list.
The home inspection process is very vague and arbitrary. The above should give the client some metrics to measure what the guy says he can do.

#98 Toon Town Boomer on 12.16.13 at 10:15 am

FSBO?? You just gave a fine example why realtors can’t be trusted.

Some realtors. You job is to find a good one. — Garth

#99 Daisy Mae on 12.16.13 at 10:45 am

#32 Chickenlittle: “We are accepting offers on Tuesday.”

“Do agents still do this? That would be my cue to run, not walk out of there!”

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

A realtor tried to create a bidding war recently in Winnipeg. Didn’t work. Two reductions later, the house finally did sell.

#100 Micamine on 12.16.13 at 10:46 am

Yep you are wrong Garth my wife and bought and sold FSBO a few times over the last 30 yrs and had no problems.

That is stunning logic. — Garth

#101 Ralph Cramdown on 12.16.13 at 10:47 am

#88 Detalumis — “I sold my last house FSBO, it sold in one day. My neighbour sold his the same way and then I used his sign and stuck it on my lawn. All I got for the next week was a flurry of calls from agents berating me and telling me that I priced it too low and should have used them.”

I tip my hat to you for out-scrooge-ing me. I had to buy four For Sale signs (corner lot) at the dollar store and a couple of 1″x2″x8′ at Home Depot. And I paid a few hundred for an appraisal. Got my ask in a week after, as you said, listening to all the local pros telling me I was too low.

#102 ozy - likely irrelevant on 12.16.13 at 10:52 am

likely irrelevant – regulators can’t produce more houses for sale in good areas

and who wants to leave in a stale area…

non-sense

regulators can do one thing is they what house prices to stop rising like crazy
-declare a zero per cent inflation target for next decade
-reduce taxes
-reduce personnel
-wages freezes for a decade

and since that is will never happen (until after a balloon in next 20 years and a major crash) house prices will rise with the real rate of inflation which is not 2-3% we all know that. The real inflation rate is the one where HOUSING GAS GOLD ALL goods and services are included. SHOW ME A SO CALLED GOVERNMENT CHART ON THIS DEFINITION OF INFLATION

OR SUCK IT UP – GO BID BEFORE IT’S 30% HIGHER

#103 recharts on 12.16.13 at 10:55 am

Garth, after buying selling 60 houses you must have some connections with RE agents. We do realize that your FSBO comment is intended not to hurt their business ☺. You probably have a good agent that you always work with and you have your reasons to say what you say but we the mortals play in a different league and don’t forget, you write for us…so don’t mix your business with our pleasure ☺

I have bought and sold privately and through agents many times. If you are too thick to benefit from someone else’s experience, on a free non-commercial blog, that’s your loss. — Garth

#104 eddy on 12.16.13 at 10:56 am

#92 Catalyst on 12.16.13 at 9:10 am

I would like to see government intervene here. They should create a website and make it law that all properties must be listed on the site and free to access for everyone. Make it queryable and easy to pull data and keep a record of all sales.


Many people type here that they want more government. You don’t have a government. The ‘government’ in Ontario outsourced property data work to terant

http://www.teranet.ca/

Want property info, get out your credit card.

The municipalities pay mpac to tell them the value of what they want to tax, its too hard for them. You want info? get out your credit card. got a complaint? don’t bother your councilor or MPP, they don’t work for you. and you want more government?
I’m thinking we should outsource city councilors, MPPs and MPs to Mechindia, we’d save a bundle

#105 recharts on 12.16.13 at 11:06 am

I know that it is THAT season but believe me, for Santa Claus and free lunch are dead concepts. They died long time ago

I have bought and sold privately and through agents many times. If you are too thick to benefit from someone else’s experience, on a free non-commercial blog, that’s your loss. — Garth

#106 Babblemaster on 12.16.13 at 11:07 am

We live in a FIRE economy that is primarily based on the Finance, Insurance, and Real Estate. Government laws and policies are generally made to benefit these sectors and not the manufacturing sectors. Why, because that’s where politicians and government officials get nice director jobs after their retirement from their cushy government jobs. The 1% are in charge. These latest changes to RE transaction rules are just window dressing.

#107 recharts on 12.16.13 at 11:10 am

#101 ozy – likely irrelevant on 12.16.13 at 10:52 am
likely irrelevant – regulators can’t produce more houses for sale in good areas

and who wants to leave in a stale area…

Don’ t be an idiot. Two years ago the Danforth area was considered garbage
The Good areas extend as the city does.

SHOW ME A SO CALLED GOVERNMENT CHART ON THIS DEFINITION OF INFLATION

OR SUCK IT UP – GO BID BEFORE IT’S 30% HIGHER

Show us a non TREB/CREA chart for housing prices …till then YOU SUCK IT !

#108 Daisy Mae on 12.16.13 at 11:38 am

#85 TiV: “New custom builds tend to get sold via the following process: list over market, and hope for a bid. After two weeks, cancel, wait, and drop the price by $25k to $50k, and re-list. Repeat until house is sold.”

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

Sounds very familiar. This is exactly what happened with the Winnipeg custom-built.

#109 rosie "moving forward" in the knowledge that, "this won't end well" on 12.16.13 at 11:40 am

I think the 3 bank guys just wanted to move forward in their lives, myself.

http://www.fortmilltimes.com/2013/12/06/3147141/fitch-canadian-banks-face-margin.html

#110 Franco on 12.16.13 at 11:41 am

Anyone that wanted to buy a house 5 years ago and did not expecting prices to crash are the real fools.

#111 rosie "moving forward" in the knowledge that, "this won't end well" on 12.16.13 at 11:42 am

It’s all good until it’s not is what I read.

http://www.thegridto.com/life/real-estate/2013-a-red-hot-real-estate-odyssey/

#112 rosie "moving forward" in the knowledge that, "this won't end well" on 12.16.13 at 11:47 am

Sounds like a chicken, egg thing. I, like Rob and Conrad, still blame the media.

http://www2.macleans.ca/2013/12/12/can-the-media-predict-a-housing-bubble/

#113 Ronaldo on 12.16.13 at 11:52 am

”Some realtors. You job is to find a good one. — Garth”

But Garth, there aren’t any are there? I’ve heard people say that, “the only good realtor is a dead realtor”.

Hope you enjoyed typing that. It was your last comment here. — Garth

#114 AB Boxster on 12.16.13 at 11:58 am

#88 Mike

Garth “Then you are a fool. Most FSBO listings are to achieve one goal: being cheap.”

I disagree.

How much effort and value was there for a realtor to sell a house that had a price 10 years ago of $250,000.
$10,000 in realtor fees. Fair? Maybe a case can be made.

At that time realtors may have actually brought buyers and sellers together.

Realtor fees to sell the same house ($500,000 , maybe $750,000 in Vancouver) 10 years later $20,000 – $37,500.
Same house, same effort (probably less due to the internet )
Fair? Don’t think so. The value of their effort is not worth the premium.

Some people may use FSBO because they are cheap.
Their houses will not sell if they are overpriced.

Many realtors are unethical because the system allows it and the ‘fools’ think it is normal.
(kind of like paying inflated prices for homes, or getting involved in bidding wars against imaginary buyers)

Many people use FSBO because the rates charged by realtors are far too high , compared to the value of the service.

Your logic is like saying I should pay a financial advisor an up front fee for him flogging his FI’s mutual, and then I can have the benefit of paying an annual 2.5-3% MER on top.
If the fund can provide great ‘value’, then perhaps 2-3% is fair.

Is it being cheap to buy an ETF that gives you the same portfolio without the fees?

You call this prudent.

Sometimes it is about being cheap.
Often it is about value.
And the value proposition for realtors has rapidly diminished.

#115 bentoverandpayingtaxes on 12.16.13 at 11:58 am

To misunderstand the ease of FSBO is to fear ones own intelligence and misunderstand real estate generally.
Heres how a FSBO works….observe the last six sales in your area…. put your own house up for sale….take out an ad(s) in whatever local media outlet…sign on the lawn….buy a standard contract from your local notary…..return the signed contract to your lawyer…..spend less than $1000 all in….buyer pays for inspections as usual…..whats the problem?

#116 DR on 12.16.13 at 12:02 pm

You especially don’t need a realtor to tell you what to bid on a home. A resale home, like a resale tractor or boat, is worth only what a potential bidder is willing to pay.

Curious as to if this was true then why do people blame realtors for rising house prices?

#117 Ronaldo on 12.16.13 at 12:02 pm

#87 – JustTryingToProtectEquity –

”A house we had bought 16 years earlier for $325,000.00.”

Congrats for cashing in your lotto winnings. One of the few smart ones.

#118 Buy? Curious? on 12.16.13 at 12:04 pm

Great post, Garth! Those realtors are a funny bunch!

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

#119 Bill on 12.16.13 at 12:07 pm

GARTH.

YOU NEED TO REVISE THE COMMENTS SECTION SO THAT ALL THE BANTER IS ORGANIZED BETWEEN OPPONENTS.
ALL THIS SCANNING THROUGH IS JUST AS HARD ON THE EYES AS USING CAPITAL LETTERS

#120 Oceanside on 12.16.13 at 12:12 pm

95 Ray Skunk on 12.16.13 at 9:52 am

Been on both sides of this fence.Overpriced from the get-go (seemingly going by the last listing on the street and slapping $20k on because, well, that’s what the market is like, right?), and refusing point blank to negotiate. After three months the comfree sign is down and the Re/Max one is up. That’s my experience, anyway.

Don’t know if realtors are different in Ontario than the ones in BC. We too have been on “both sides of the fence” But Ray’s statement is bang on for experiences we have had out West. Selling privately worked 20 years ago but things are too complicated these days, especially with disclosure and the money involved. In this market the private sales just go unnoticed at least in our neck of the woods. We don’t even look at FSBO’s anymore as there always seem to be something “kinky” with them.

#121 Josh in Calgary on 12.16.13 at 12:23 pm

In my house hunting experience there is no such thing as a “perfect” house. Every time we found a great house, there was always a better one if we kept looking. Once you learn this you are much less likely to feel the need to outbid everyone for a nice house. Just let some other chump pay the inflated price and find the next good one that’s selling at a reasonable price.

#122 Derek R on 12.16.13 at 12:26 pm

#104 recharts on 12.16.13 at 11:06 am wrote:
I know that it is THAT season but believe me, for Santa Claus and free lunch are dead concepts. They died long time ago.

Don’t know about Santa but the free lunch is still alive and well. Only reason that you haven’t got one is that they have all been grabbed by the early birds. But new ones are created all the time by arbitrary government legislation, technological innovation, fear and greed. You just have to keep your eyes open and grab when they come up because they don’t stay free for long.

And once others have snapped them up, they ain’t free no more. You will have to pay if you want a share.

#123 Retired Boomer - WI on 12.16.13 at 12:45 pm

FSBO comment…

After having bought, and sold 6 properties, and 1 new build in my lifetime I have never gone FSBO.

I had looked at FSBO properties. Usually they were overvalued by the owners, or had glaring defects, or were just not maintained adequately.

Very much like trying to sell a used car. Clean, and polished you tend to get much more than a dirty car that smells of stale smoke, and old fast food. If I wanted a dirty car / house I would pay proportionately less for it.

REALTORS do bring some value to the transaction. The fees are negotiable. When buying we used a buyer’s agent.

My experiences had been good. If I ever sell the current digs will use a Realtor with a good track record.

#124 Don M on 12.16.13 at 12:54 pm

Here are the top three “most viewed” headlines on teh CBC Business page this morning:

“Average home price rises almost 10% to $391,085”
“Jim Flaherty hints at pension reform proposal”
“Personal debt ratio hits record high of 163.7%”

Surely, it doesn’t require a graduate degree in economics to draw a line through these three stories. And just as surely, there are reporters that aren’t under the yoke of the CREA marketing department. So why don’t we see more widespread concern?

#125 Blacksheep on 12.16.13 at 1:03 pm

“The best possible defence against being mortally wounded in a bidding war is to not join one. – Garth”
——————————————————
It’s that simple. Repost for relevance.

My realtor has standing instructions: When contact is first made with a listing agent, tell him:

A) No offer will be made, if there is any other offers in play.

B) If a new offer comes in while in negotiations, were walking.

#126 TnT on 12.16.13 at 1:17 pm

Yeah! Were up! …..

http://www.cbc.ca/news/business/average-home-price-rises-almost-10-to-391-085-1.2465695

http://business.financialpost.com/2013/12/16/canadas-housing-market-stronger-than-expected-this-year-and-will-be-stronger-in-2014-crea/

Do’h! Were down….

http://www.bloomberg.com/news/2013-12-16/canada-nov-existing-home-sales-fall-0-1-vs-previous-month.html

http://www.businessweek.com/news/2013-12-16/canada-consumer-sentiment-declines-on-waning-outlook-for-housing

#127 Ralph Cramdown on 12.16.13 at 1:25 pm

#116 DR — “You especially don’t need a realtor to tell you what to bid on a home. A resale home, like a resale tractor or boat, is worth only what a potential bidder is willing to pay. Curious as to if this was true then why do people blame realtors for rising house prices?”

This sentiment works for relatively sophisticated 50-somethings buying a property with significant equity. They’ve been through a few transactions, decades of real estate markets, and know the value of a dollar. So when they bid, they usually know.

Compare and contrast with a young single or couple, only working for a few years, with part of the 5% down+costs gifted from family, and a bank preapproval for $x as long as CMHC says yes. Are you really going to say that whatever they buy is worth $x because the market says so? They don’t know real estate, don’t know the value of a dollar, don’t know the difference between their parents living house-poor for a few years in an era of 3-5% inflation and declining interest rates and the next generation doing it in a low inflation, flat-to-rising rate era. Their bank doesn’t care if they’re looking at ten years of ramen noodles as long as CMHC has its back.

Efficient market theories assume sophisticated (or at least intelligent) traders on both sides and no great information asymmetry. Game-theoretic approaches assume that the player with less information is smart enough to discount appropriately.

The law, all the way back to the Statute of Frauds, assumes that people wealthy enough to transact in real estate are smart enough to look after themselves, or their bankers are prudent enough to only make conservative loans. That’s why real estate has far less consumer protection legislation applying to it than buying a bottle of root beer at the corner store.

Our system evolved with assumptions rather different from the current market.

For a more practical proof, just look at investment residential properties. The condos-for-rental, and two-and three unit houses often have a horrible cap rate, whereas a 10- or 20 unit building often has quite a reasonable rate of return. Why? Because the marginal buyer of a bigger building is usually a whole lot smarter than the marginal buyer of a triplex.

#128 Not 1st on 12.16.13 at 1:26 pm

3D printing technology will soon render realtors obsolete. Nobody will move anymore, you will just melt down your existing house and print up a new one in its place. Of course you need to get a quality lot to accommodate all your future designs

#129 Buy? Curious? on 12.16.13 at 1:33 pm

#113 Ronaldo on 12.16.13 at 11:52 am
”Some realtors. You job is to find a good one. — Garth”

But Garth, there aren’t any are there? I’ve heard people say that, “the only good realtor is a dead realtor”.

Hope you enjoyed typing that. It was your last comment here. — Garth

I don’t know why people get so angry with real estate agents. Ever hear the expression, “Don’t hate the playa, Hate the game.” Developers, brokers, Hedge Fund Managers, Politicians (Not you Garth) have all rigged the game. It’s like arresting and jailing a drug dealer over $30 of crack when a bank is laundring millions of dollars from major drug deals.

When talking about real estate agents, let’s try and show a little respect.

http://www.youtube.com/watch?v=w7Myff5xAZM

Oh, and Ronaldo, you’re fat, ugly and your mother never loved you. I look forward to your response.

#130 Ralph Cramdown on 12.16.13 at 1:35 pm

#124 Don M — “So why don’t we see more widespread concern?”

Cognitive dissonance. If you own your home (and 70% of Canadian families do), here’s your choices:

– market is gonna crash, so I’m gonna sell
– market gonna crash, I’m rich enough in other assets that I don’t care
– market not gonna crash

Since selling and renting is expensive, a hassle, and will be reviled by friends and family, and since few people fall into category two, most owners would rather rationalize #3 than admit that they are planning on dumbly holding a declining asset. Media types, bank economists and the RE industry thus usually have a vested interest in telling the same story.

#131 omg on 12.16.13 at 1:38 pm

BOUGHT AND SOLD FSBO

I have bought 1 FSBO and sold 2 FSBO – no problems. You just need to do some homework on the market in your area, to get a good feeling on pricing. Check out realtor open houses, the RE publications and online listings.

You’ll need a lawyer experienced in RE – he’ll write your offer up for $200 and deal with your deposit.

Its true that the majority of FSBO are overpriced, but occasionally you’ll get a great deal. Because FSBO are overlooked by most people there is not a lot of competition for them.

#132 Bottoms_Up on 12.16.13 at 1:43 pm

#76 Jeremy on 12.16.13 at 1:05 am
————————————–
Isn’t it obvious from reading the stories on here? Person sells in 1 day (ooops, either in an extremely hot location, or underpriced by the FSBO). Other FSBO’s…taking months if not years to sell (and then having to use an agency to sell). FSBO’s are a crap-shoot….find a good agent, they will price the home accordingly (or save you from overpaying)…they are worth their weight in gold (or worth at least what you pay them).

#133 T.O. Bubble Boy on 12.16.13 at 1:49 pm

Bitcoin back to $805 this morning…
http://bitcointicker.co/

(must be people cashing out to buy xmas presents)

#134 Mister Obvious on 12.16.13 at 1:49 pm

#119 Bill

No Bill. Garth is a prolific and talented blogger. Other than Saturdays there are, without fail, only 24 hours between his postings. Yesterday’s blog becomes old news fast and we tend to move along quickly here.

The comments section is a nice thing to have. It offers a small chance for the rest of us to participate in this successful forum. But let’s be honest, it’s not the main attraction nor is it deserving of the time and effort it would take to implement thread organization for the short time each blog entry is current.

Garth already caters significantly to the diverse group of regular commenters here. Count your blessings and quit bitching in UPPER CASE.

#135 rosie "moving forward" in the knowledge that, "this won't end well" on 12.16.13 at 1:53 pm

Do you see any inflation. These guys don’t. Maybe we’ll all get a raise.

http://www.bloomberg.com/news/2013-12-16/tips-wipeout-signals-fed-losing-fight-against-u-s-disinflation.html

#136 45north on 12.16.13 at 1:58 pm

ozy: regulators can do one thing is they what house prices to stop rising like crazy
-declare a zero per cent inflation target for next decade
-reduce taxes
-reduce personnel
-wages freezes for a decade

your sentence in incoherent. You say regulators can do one thing but list four things. Regulators are bureaucrats who draw up rules to implement legislation. The four things are clearly outside the regulators’ power and pretty much outside the power of legislation.

I’m disappointed. I thought you were the same ozy that pointed out the study “The Three Cities within Toronto”

http://www.urbancentre.utoronto.ca/pdfs/curp/tnrn/Three-Cities-Within-Toronto-2010-Final.pdf

#137 T.O. Bubble Boy on 12.16.13 at 2:12 pm

Or, maybe Bitcoin owners are cashing out to invest in Bitcoin-related companies, like Coinbase:
http://www.hispanicbusiness.com/2013/12/16/bitcoin_startup_raises_25_million_in.htm

#138 45north on 12.16.13 at 2:17 pm

bitcoin: dropping like a stone

http://bitcointicker.co/

love the red and green – very Christmassy

#139 Spectacle on 12.16.13 at 2:20 pm

Thank you for the Excellent work here Garth. I’m not the only one who Greatly appreciates this Blog!

Words from me today…

– join in here with excellent comments, ( I read them entirely, with great rewards )

– get a Puppy, day three for ours, and man do I need sleep…..a best decision for sure! Cocoa, a girl!

– Believe in something, even Santa Clause……

#140 Lurker on 12.16.13 at 2:25 pm

Friends of ours bought a house earlier in the year in North Vancouver and thought there would be multiple bids (said their realtor) but they were surprised that they were the only ones interested. I don’t know what they paid, but I suspect full asking price and then some. This is for a 100 year old house where they need to take in two students to help pay the rent. I think I’ll just keep renting my million dollar house for two grand a month!

#141 Lurker on 12.16.13 at 2:28 pm

Went to the keg for dinner last night… Place was packed! Wow. People seem to have money to spend. Tables full of families where the bill will be in the multi hundreds of dollars.

Is that high-end dining for you? — Garth

#142 Chris Walker on 12.16.13 at 2:30 pm

Garth, I have been reading your posts for a short while and have been impressed with your logic and wisdom (and no doubt will continue to do so).
Your parting shot re. ‘for sale by owner’, however, is a relief – it shows that you are human and capable of making mistakes.
I have bought and sold the last of my four houses by fsbo and saved tens of thousands of commissions to these devious parasites. Yes, you have to deal with buyers more directly but there are ways to mitigate the discomfort that can cause. Inspectors, appraisers and lawyers cover everybody’s butt.
Realtors have created the myth that we need them to sell a house and most people are stupid enough to believe such self-serving nonsense. Too bad you are helping them.
(And good luck with getting the vermin to negotiate the commission downwards).

Calling an entire group of people “devious parasites” says more about you than anyone else. — Garth

#143 Victoria - the Original on 12.16.13 at 2:30 pm

HOUSE PRICES UP 9.8 % THIS YEAR – 2014 Looking Stronger!!!!!!

http://www.huffingtonpost.ca/2013/12/16/housing-forecast-2014_n_4452949.html

#144 KommyKim on 12.16.13 at 2:34 pm

RE: #36 broadway skytrain on 12.15.13 at 9:57 pm
You miss-spelled “fradulent”. It’s “fraudulent”.
——————————-
priceless comrade, just f’ing priceless.
*miss-spelled* HAHAHAHAHAHAHAHAHAHAHAH breathe HAHAHAHAHAHAHAHAHAHAHAH\
commie police need not follow rules!!!!
i trust you are posting from cuba or NK right?

I’m glad that you got my ironic joke. Now go change your diaper!
If you had read the rest of my post, you’d realize that I’m in neither Cuba nor NK.

#145 jess on 12.16.13 at 2:36 pm

self employed tax scheme

5,000 self-employed workers through the courts for millions of pounds in unpaid tax after winning a landmark case concerning offshore avoidance schemes.

A tribunal last week ruled against 350 contractors who used an offshore loan set-up put together by a company called Sandfield Consultants. The scheme was a variant of a tax ruse once popular among City workers, in which some income is paid through a loan. The loan is made by an offshore firm in a foreign currency that is falling against the pound.

When the loan is due to be repaid, the currency is so devalued that the sterling cost of repaying it is minimal and certainly less than the tax that would have been due had the money been given as taxable pay.

Read more: http://www.thisismoney.co.uk/money/news/article-2523715/15-000-self-employed-face-courts-massive-tax-dodge.html#ixzz2nfECOmxD

#146 45north on 12.16.13 at 2:49 pm

Lurker: Went to the keg for dinner last night… Place was packed! Wow. People seem to have money to spend. Tables full of families where the bill will be in the multi hundreds of dollars.

Is that high-end dining for you? — Garth

it is for me

#147 Nemesis on 12.16.13 at 2:59 pm

ThematicallyInspired MondayMorning AuthenticZen™ HatTrick!

… for SaltierDogz…

“It’s a gigantic problem.” – Rony Swennen, BananaBreeder, International Institute of Tropical Agriculture, Dar es Salaam, Tanzania.

[UK Independent] – Scientists ‘incredibly concerned’ for fate of banana as plagues and fungus infections spread across world’s supplies

…”Scientists believed the disease, caused by the fungus Fusarium oxysporum f. sp.cubense (Foc), was limited to parts of Asia and Australia. Yet it has now been found in Jordan and Mozambique, and in a new strain to which the vast majority of bananas are susceptible.”…

http://www.independent.co.uk/news/world/americas/scientists-incredibly-concerned-for-fate-of-banana-as-plagues-and-fungus-infections-spread-across-worlds-supplies-9008109.html

…BritishBananas, MercifullySpared from GlobalPandemic, arouse PM Cameron to proclaim, proudly:

“We’re doing all we can to ensure that businesses up and down the country reap the rewards from our relationship with China. And that includes our pig farmers.” – PM Cameron

[LAT] – Britain to export $73.5 million worth of semen to China

http://www.latimes.com/business/money/la-fi-mo-pig-semen-britain-china-20131205,0,2280021.story

…et la Pièce de Résistance [illustration]…

[XinhuaNet] – Iran claims 2nd monkey back safely from space

“It was, like, WayMore fun than shopping at Ikea!… But, seriously folks, it was the second stupidest thing I’ve ever done… after buying a condo in HogTown, that is.” – FarGam, Iranian AstroSimianaut

http://news.xinhuanet.com/english/photo/2013-12/16/c_132972058.htm

#148 Squatter on 12.16.13 at 3:21 pm

#128 Not 1st on 12.16.13 at 1:26 pm

3D printing technology will soon render realtors obsolete. Nobody will move anymore, you will just melt down your existing house and print up a new one in its place. Of course you need to get a quality lot to accommodate all your future designs
—————————————————–
What??? Your 3D printer can’t print a quality lot???
That new technology is worth nothing!

#149 Chris Walker on 12.16.13 at 3:23 pm

Garth, my use of the term ‘devious parasites’ to describe real estate agents refers to their functional attributes, not their personal attributes. As human beings they are very likely as good or bad as any group outside of their working lives. When engaged in their quasi-profession realtors add significant costs while adding minimal or negative value, and the vast majority regularly do so using a spectrum of deliberately misleading and manipulative practices, as you have described.

Some, without a doubt. All, no way. Be careful with your generalizations. — Garth

#150 Ms. Rebble on 12.16.13 at 3:31 pm

#141 Lurker on 12.16.13 at 2:28 pm
Went to the keg for dinner last night… Place was packed! Wow. People seem to have money to spend. Tables full of families where the bill will be in the multi hundreds of dollars.

Is that high-end dining for you? — Garth
————————————————–
Snob

Maybe so, but a Keg full of people does not by itself equate to affluent citizens and a bouyant economy. Many folks go there for value. — Garth

#151 recharts on 12.16.13 at 3:32 pm

#137 T.O. Bubble Boy on 12.16.13 at 2:12 pm
Or, maybe Bitcoin owners are cashing out to invest in Bitcoin-related companies, like Coinbase:
http://www.hispanicbusiness.com/2013/12/16/bitcoin_startup_raises_25_million_in.htm

#138 45north on 12.16.13 at 2:17 pm
bitcoin: dropping like a stone

http://bitcointicker.co/

love the red and green – very Christmassy

☺☺☺☺
That is because there are plenty of idiots who believe that “free lunch” exists and they wait for one to be delivered to them.
They are lined up (some of them around here), their mouth with wide open, they just don’t know what is going to drop in that open cavity.
For some the cavity extends all the way to the back of their head
☺☺☺

#152 Bill Gable on 12.16.13 at 3:37 pm

The possibility that the Federal Reserve could finally start to trim its extraordinary stimulus for the economy could make this week an explosive one for financial markets.

Though the odds still point to no major policy change when U.S. central bankers meet December 17-18, most of the recent domestic economic data suggest the beginning of the end of their massive bond-buying program is coming sooner than later.

Link: http://tinyurl.com/kzflktp

Of course it will end. Not quickly, but it will end. — Garth

#153 World Traveller on 12.16.13 at 3:42 pm

Looks like a return to the cold war is coming.

http://www.reuters.com/article/2013/12/15/us-ukraine-eu-idUSBRE9BE05120131215

#154 World Traveller on 12.16.13 at 3:44 pm

#128 Not 1st on 12.16.13 at 1:26 pm
3D printing technology will soon render realtors obsolete. Nobody will move anymore, you will just melt down your existing house and print up a new one in its place. Of course you need to get a quality lot to accommodate all your future designs

Some more info on this:

http://www.ibtimes.com/3d-printers-build-entire-houses-contour-craftings-aims-print-2500-square-foot-homes-20-hours-videoa

#155 Ripped on 12.16.13 at 3:53 pm

“Never go FSBO” is a pile of crap.

The house won’t move if it’s overpriced through a realtor or FSBO

End of story

#156 Zeeman1 on 12.16.13 at 4:01 pm

“We are accepting offers on Tuesday.”

Do agents still do this?

That would be my cue to run, not walk out of there!

Yes, chicken little, it’s common practice for all realtors to force the offers on 1 day, thereby instantly creating a bidding war, as every bidder knows they’re up against others. This easily creates bidding wars and should be declared an illegal activity, IMO.

In no other industry would this practice be tolerated.

in the recent past you just offered whatever you wanted whenever you wanted.

#157 jess on 12.16.13 at 4:03 pm

Paradise of Untouchable Assets
What do the “octomom” doctor and Allen Stanford have in common and many others?

Leslie Wayne is a senior writer for ICIJ. This story is co-published with The New York Times.

…”Even the United States government has had a hard time going up against a Cook trust. In a lawsuit that has dragged on for years, Fannie Mae, a government-sponsored lender, is still waiting to collect on a $10 million judgment against an Oklahoma developer who defaulted on his loans. In legal filings, Fannie Mae says it has collected only $12,000…

The Federal Trade Commission, as well, has come up dry. In 2007, the F.T.C. won a $37.5 million judgment against Kevin Trudeau http://www.ftc.gov/os/caselist/0323064.shtm for “airing blatantly deceptive infomercials” for his diet book “The Weight Loss Cure,” but has collected nothing so far. Mr. Trudeau, who lives in Chicago, had been jailed, on and off, for contempt over his refusal to testify about his Cook Islands trust (named the Sovereign trust)and other offshore accounts.

read [email protected]
http://www.icij.org/offshore/paradise-untouchable-assets

#158 IM in C on 12.16.13 at 4:21 pm

That’s exactly what the real estate agent told her. “You’d better make this your best shot because there’s gonna be a lot of competition.”

In all fairness , the real estate agent never said there -actually was- a bidding war. She made a forward looking statement saying there -will be- a lot of competition ; without actually defining what that competition would be, at least not in the example as it is presented above.
The buyer wanted the house, to the point where they were willing to put in a bid 100k over asking

#159 jan on 12.16.13 at 4:50 pm

CREA says house priced up 10% this year and will be even more in 2014.

OMG – how stupid of me living an honest life in this crooked country that was obviously designed for pillaging and raping !!!!!

#160 Oceanside on 12.16.13 at 4:50 pm

———————————————–
Snob

Maybe so, but a Keg full of people does not by itself equate to affluent citizens and a bouyant economy. Many folks go there for value. — Garth
_______________________________________________

Driving by the local McDonalds here between 4 and 6pm looks like a CARP convention, parking lot is full every day. This speaks volumes for how seniors are faring in this economy. I imagine that there are a lot of couples that never see the inside of a Keg and the $80 it takes for two meals and a bottle of cheap wine.

#161 my chicken has huge breasts on 12.16.13 at 4:51 pm

Of course it will end. Not quickly, but it will end. — Garth
——————————————————-
But will it end well? I’m always reading comments that this will not end well.

#162 Yin Yang on 12.16.13 at 5:03 pm

Nice Fish!
It’ll make for a delicious dessert once that grizzly is done chewing the last bit of flesh off that guy’s skeletal remains.

#163 Entrepreneur on 12.16.13 at 5:03 pm

#80 Derek R. My last post said “create money” should have been “make a buck” or something like that.

You also said I’m not the money producer; you are the goods and services producer. My repy: Small business cannot produce money literally and are not given any money (only loans) but we do have to “make a buck” by selling a product or service.

A small business has a hard time surviving and most will disappear. When they “make a buck” some of that money has to go taxes (and quarterly) to the government. All responsibilities are on the small business from top to bottom…we have to “make a buck” to make it work…no back up and if falls, hopefully learn some points and move on.

It would be nice to give small business $5000. or more leeway on expenses like the politicians…an incentive. We need more incentives which will create more fuel to the economy.

Small business

#164 Oceanside on 12.16.13 at 5:09 pm

It is interesting to see how much venom is out there for realtors. We live in an area of about 20,000 so we know realtors, bankers, teachers, mechanics, car salespeople etc…I know from talking to realtors here that the job is no picnic. Lots involved in getting a licence now, required ongoing training to keep their licences active. Office, MLS and other assorted fees are between $600 to well over $1,000 per month, no medical or any benefits. Advertising is very expensive especially when the vendors want far more than their homes are worth and after having a listing for 6 or more months the costs cut down on any personal profit. They work 7 days a week and all hours…Not a job I would like but I think they like the freedom to be their own bosses.

I’m sure there are bad realtors out there like any profession, why not just avoid them? Just don’t understand all the hatred, possibly being in smaller centres without all the big developer’s hype we just don’t seem to have the problem with them..We are in control of our own finances and if we lose or win in the real estate game the bottom line is it is up to us, nobody else to blame.

#165 Derek R on 12.16.13 at 5:30 pm

#160 Entrepreneur on 12.16.13 at 5:03 pm wrote:
A small business has a hard time surviving and most will disappear. When they “make a buck” some of that money has to go taxes (and quarterly) to the government. All responsibilities are on the small business from top to bottom…we have to “make a buck” to make it work…no back up and if falls, hopefully learn some points and move on.

It would be nice to give small business $5000. or more leeway on expenses like the politicians…an incentive. We need more incentives which will create more fuel to the economy.

Fully agree with you there, Entrepreneur. Small business is the lifeblood of the economy. If it’s healthy, the economy is healthy. We should be doing all we can to support it.

#166 Ronaldo on 12.16.13 at 5:44 pm

#129 – Buy Curious – your attempt at being a comedian was just as bad as mine. Still laughing at your comment.

#167 DR on 12.16.13 at 5:55 pm

“Never go FSBO” is a pile of crap.

The house won’t move if it’s overpriced through a realtor or FSBO

End of story

Guy almost sold me a house for 645K..in April. He just listed it again about one week ago…only 849!

#168 CJ on 12.16.13 at 6:01 pm

I paid $465,000 for a bungalow in Calgary that was listed at $449,000. I must be the Greater Fool.

#169 Ab Boxster on 12.16.13 at 6:38 pm

#141 Lurker

Re: The Keg

I hear you.
I took my family of 4 to the Keg the other night.
Wow, prices sure had changed since the 80’s.

Appetizer, couple glasses of wine and 4 entrees and we walked out of there for about $230 including tip.

It might not be high end dining, but it sure wasn’t cheap for meat, praties and a few veggies.

#170 Steven on 12.16.13 at 7:03 pm

Realtors can not be neutral when it comes to house prices and the reason for this is clear. They get a commission on the price of the property in question therefore the higher the price goes the better for the realtor. Common sense and a social conscience doesn’t maximize a realtors commissions or profits.
There is no incentive to restrain or lower house prices.
As the real estate bear market progresses I expect the number of real estate agents to be decimated and may be a few companies will go broke due to poor sales or no sales.

#171 Mark on 12.16.13 at 7:20 pm

Two sane, reasonable people should be able to complete a real estate transaction without the need for a middle-man taking his cut and providing little value. The problem is, most people are not sane or reasonable.

And for those who would argue that they do provide value, by showing your house and driving you around, well, I beg to differ. If you price your home more reasonably and hire a professional home stager for a couple hundred bucks, you probably wouldn’t need to hold 30 open houses. And if you argue you don’t have time to drive around to open houses on the weekend, what makes you think you’ll have time to maintain a home??

Two hundred bucks for a stager? Do you live in Wabush? — Garth

#172 neocon=anarcho-capitalists on 12.16.13 at 7:22 pm

@Life’s a supermartingale

I vehemently disagree. You’re only correct if people don’t make mistakes, but they do, and especially when guided by people they trust as experts but who do not necessarily have their best interests at heart.

It’s also a cognitive dissonance to believe that extracting complete information from all auction participants is valuable and inherently desirable, but the winner of the bid is not entitled to factually correct and complete information about the auction (other bidders, bids, etc).

#173 Ken R on 12.16.13 at 7:22 pm

#92 Catalyst on 12.16.13 at 9:10 am

Don’t ask the government to create a website, 2 billion price tag minimum. Remember the gun registry?

#174 TheCatFoodLady on 12.16.13 at 7:26 pm

I haven’t been involved in the purchase or sale of a home in… 25+ years so am in no position to judge the advantageousness of using a realtor. I don’t know all of today’s legalities involved in purchasing a home – what are my legal obligations putting in an offer? When MUST a reply come in? What about conditions – what are legal, what aren’t? No doubt a ton of other things with which I’m not familiar & should be if I were buying.

But realtor or FSBO, certain steps I wouldn’t skip:

Serious number crunching – what could I really afford? Can I afford it if I have to go with a higher rate when I renew? Whatever budget formula I use, have I accounted for ALL potential purchase costs? How about carrying costs – taxes, repairs, maintenance?

House inspection – damned right I’d hire my own independent inspector & show me your credentials, buddy. Show me an itemized list of what you’ll inspect & you can bet your boots I’ll have researched it!

Set myself a price ceiling – I’m not going a cent above it because as wonderful as a house may be, the world is full of ‘perfect’ houses. Bidding wars, etc? My first offer WILL be my best offer pricewise – take it or leave it.

Not too tough to find a good realtor. ASK people you know, neighbours who recently bought or sold. A good, local realtor will be known. Check agency websites – preferably starting months out from when you want to use them. Check prices, the photographs taken, how quickly properties seem to move…

If you go FSBO, learn what you need to KNOW, especially legally & determine your sticking points – price, various conditions. If the owner gets balky or in any way stupid – walk. If you really like the place, as a buyer & it’s still listed months later, you can go back.

TRY to keep the emotion out of it – it can be hard. There are a million cheap & easy staging/selling tricks that appeal to emotion – the smell of baking bread or cinnamon wafting through a sparkling kitchen, etc. You’re not buying a loaf of bread or an apple pie. LOOK at the place. Open doors, check every room in detail – bring a flashlight for dark corners. If you get serious about a place & don’t properly check the attic & basement, you’re an idiot. Learn what mould looks & smells like as well as signs of vermin infestation.

No reason not to get a good deal if you do your homework & approach buying as an investment rather than a proposal. Selling? Declutter, clean up, have some close friends give you an objective opinion, then don’t insult them or get squiffy when they ARE honest.

#175 DR on 12.16.13 at 7:27 pm

I don’t know where this comes from. A realtor can never put ink to paper on their own…all they can do is submit an offer given to them from a buyer.
They can try all they want if I want to submit 425000 with fifteen offers I don’t care what a realtor says i’m not going to submit 600K. if im not going to be willing to pay that amount. Whats so hard to understand about this.

#176 Ripped on 12.16.13 at 7:34 pm

“Never go FSBO” is a pile of crap.

The house won’t move if it’s overpriced through a realtor or FSBO

End of story

Guy almost sold me a house for 645K..in April. He just listed it again about one week ago…only 849!

……………………………………………………………………..

… and it will sit some more

#177 jess on 12.16.13 at 7:39 pm

especially note IBM’s change to 401k

http://toomuchonline.org/presenting-americas-ten-greediest-of-2012/

#178 DR on 12.16.13 at 7:47 pm

……………………………………………………………………..

… and it will sit some more

Private sellers for you. Don’t sell your house at 650 that’s ok lets try an extra 200K. Really?

#179 Andrew Woburn on 12.16.13 at 9:50 pm

It’s not that hard to find a good realtor. Cruise your neighbourhood for a few months and see who gets the listings and who sells them. How long have they been around? Can they connect with the current likely buyers in your area from an ethnicity, age or gender point of view? Can they answer reasonable questions? Do they provide you with useful community information? What do they think is currently driving the market? How desperate are they? If they start shoving pens into your hand five minutes into a conversation, just walk.

There are way too many realtors in good times but only the truly successful survive recessions. That usually means they survived off referrals from satisfied customers. I did a lot of homework choosing a realtor for our last sale and got a veteran who bagged us $100K over comparables. I was never so happy to pay an “outrageous” commission.

#180 HouseSense on 12.17.13 at 1:22 pm

Nothing wrong with buying/selling privately
Lots wrong with paying 5% for 2 weeks or less work!
How much does a lawyer charge for same?

In my mind, for the average consumer, Real Estate Agents are “Glorified Introduction Services”.
Think about it, with the internet, what does an agent do for you? You find the property on the internet, you do the virtual tour…you get the home inspected..whats left?
Sure they can assist in the deal but at 5%?

You can do comparables with current listings.
All legal affairs are the same, agent or none.
One who does a bit of research can take care of their own deals. The days of agents charging 5% to the blind following are coming to an end, quickly.
I sold a house in 1985 which cost me $18.00 (a sign at Pascals hardware, got the forms, both parties visited their lawyers …done!
If you feel you need some help, use the alternates who charge a fixed fee and can offer services in negotiations.

#181 Victor on 12.17.13 at 5:28 pm

Interesting if there must an new bill to force MSL to add DOM to the property details page. I imagine a huge resistance from realtors as it seems to be a beneficial thing to find an offer to make.

#182 ozy - u got the idea on 12.17.13 at 7:44 pm

RE #101 ozy – likely irrelevant

come on, you’ve got the idea, are u kindergarden to engage in spelling to word technicalities…

govt or pulliticians or regulators -same boat and they can’t produce more land in desired hoods – and no one wants a 2h commute…o they can, launch a new capital city!

they can’t do a thing…already cut from 40 to 25 years and prices kept climbing…in Toronto

it’s an invasion man, it’s an invasion – the world is plotting against us :)

#183 Condo Chris on 12.19.13 at 12:17 am

Here is the truth about FSBOS

http://www.condochris.ca/2012/12/the-grain-of-salt-factor/

– proud Realtor