Spring

risk 1 (2)

If you write a pathetic blog, expect letters. Some of the people who write me are thoughtful and constructive. Others should be locked up. Here are a few worth reflecting on.

“I need an outlet to vent my HAM frustration and you’re my guy,” says Marc. “I rent a lovely bungalow in a great area of Toronto.  My area is in transition as the bungs get torn down and McMansions built on the 60′ lots.  The one across the street from me sold for 1.8 to HAM last summer in a week.  My backyard neighbour has been bought by HAM and is being torn down and rebuilt.

“My beef with HAM is this; the dude across the street from me bought a used dodge, waters his lawn with a bucket, trims with scissors, cuts with a $99 electric mower and has shovelled the entire winter with a small child’s shovel.  They have no blinds on their windows and I can clearly see that they have no furniture.  He seems to wear the same pants everyday and nobody in the house works.  So aside from property tax what does he contribute to our economy?

“From what I see in the area this is not uncommon. HAM know how to live frugally.  So in the short run they boost up housing prices but what happens in the long run?  What happens to an economy filled with such frugality?  When do we crest the apex of affordability vs sustainability? Please take this, put your lovely touch on it and blog away my friend.”

First, Marc, HAM means ‘hot Asian money.’ Like from Asia. It’s not a racial epithet for yellow people from Unionville or Richmond who drive Dodge minivans. Get over it. As for the economic contribution this family is making, they paid $32,475 in provincial land transfer tax when they bought the place across the road, and another $31,725 in tax to the municipality, just to have the name of the deed changed. That’s $64,200 in tax.

Expressed another way, the dude across the road would need an income of at least $180,000 a year in order to pay that amount of income tax in a year, but in this case it was assessed just because he bought the property. So no wonder he uses a plastic shovel and has no furniture. By the way, the property tax there will be about $8,500 a year, plus utilities, insurance and maintenance.

So even if the dude doesn’t work, or anyone in the house (more than unlikely), they have clearly paid the freight already for many years to come. Now, explain why you’re using binoculars to watch his pants.

Okay here’s Rodrigo, whose wisely decided it’s time to bail out of his real estate and get liquid. “After all of the expenses related to selling the house including breaking the mortgage,” he says, “my wife and I might be left with around 175K which we hope to invest.   Should we list right away or wait for the spring? Also, can you provide me with a link of your blog where you talk about best practices for selling a house.”

News flash, Rod. It is Spring. At least if you’re in a major urban centre like Toronto, Calgary or Vancouver. It started about a week ago, shifts into higher gear the first of March, and hits its crescendo four or five weeks later. Even that polar vortex thingy was not enough to stop the hormonal juices from starting their osmotic ascent through the loins of the house horny, which means every week will bring a new gush of listings and even some 2.99 mortgage offerings.

So, get ready to list now, which includes finding an experienced realtor in your hood, sprucing up and staging the place and (especially) getting the right price. Don’t even think about FSBO, because this may be the last Spring you get.

Susan lives in Calgary with her husband, and was shocked at a story he came home with last week. “One of the guys he works with is up to his eyeballs in debt.  (He’s in his forties, married, with three kids).  He and his wife make about $150,000 between the two of them,” she says.

“So, my husband suggested he look at a consumer proposal as he was at the end of his rope.  So the guy called, I believe Money Mentors, and they were so busy they couldn’t get him in for an INITIAL meeting until March 31.  They told him they have NEVER been this busy and are pushing through an application every half hour, per agent.  And that is just a Calgary office.  What’s the rest of the country doing?  Just thought you should know….possibly a sign of the overextended times?”

The latest stats suggest about 20% of everybody will eventually go bankrupt, Sue. It’s a shocking number, but should surprise nobody. Debt is endemic, and doesn’t seem to scare people the way it used to. The debt-to-income level of about 165% is at a record (US personal debt is 136%, and falling), and mortgage indebtedness just went off the charts.

And this is with 0.9% car loans and 3% mortgages. Just wait until inflationary pressures force rates to normalize. Calgary? Why shouldn’t things be worse in a city where house prices are ridiculous? A SFH in Cowtown now costs almost $480,000 and is 26% more expensive than five years ago. Someday more locals will understand this isn’t something worth growing chest hair over.

Lastly, Sarah and her BF are arguing over urban vs suburban, in light of crappy construction likely to turn McMansions into OSB money pits and the inexorable real estate exodus of the wrinklies.

“I’ve always been a city dweller (I rent an apartment in downtown Toronto) and my boyfriend is from the suburbs and can’t wrap his head around the small living spaces here.   He wants to move back to the suburbs where we could live in a place 4 times larger, however I’m hesitant to ever invest in a suburban McMansion which I think will lose value as soon as all the boomers all start selling their houses for retirement funds and is cheaply constructed.”

But Sarah also knows a forest of DT condos built with glass curtain walls will eventually be delivering massive special assessments to their freaked-out owners. Now to mention there’ll be precious little after-market for concrete-floor lofts and 400-foot micro-boxes.

“Inflated market and overextension of debt aside, when faced with an inventory where affordable housing is mediocre at best, am I being dramatic in finding none of the above appealing?   I hope your leg gets better soon and that Bandit isn’t traumatized.”

No drama, Sarah. You’re perceptive. Both cul-de-sac suburban and city condo markets have deeply imbedded risks. I wouldn’t touch either right now. In a city like Toronto there’s only one housing type which has the potential to better weather an inevitable correct, and that’s a low-rise SFH. Detached best, followed by semis and rows, then condo towns. Buy dirt, in other words, and get through the property storm a little easier.

Of course, that’s exactly why a detached SFH in 416 is pushing $900,000. That and mass, unsustainable delusion.

As for Bandit, thanks for asking. When I tumbled he lay beside me. When I crawled home he crept with me. When he hears my crutches he wags furiously. When I grow sad he sticks a giant, sticky, wet, hairy, peanut butter-encrusted protrusion in my face. I am blessed.

230 comments ↓

#1 TurnerNation on 02.09.14 at 7:10 pm

The kids are all right?

Once saw a bike with an ape drape (no comment) and its shift lever mounted just behind gas tank. Shift by hand.

#2 Keith in Calgary on 02.09.14 at 7:11 pm

The SWISS are my heroes.

Read the news.

#3 TurnerNation on 02.09.14 at 7:16 pm

Wait it’s Ape Hanger handlebars. Though the other one might fit…

O well, cagers Find Paradise by the Dashboard Light.

#4 Retired WI Curmudgeon on 02.09.14 at 7:25 pm

Your comment tonight “Latest Stats suggest 20% of everybody will eventually go bankrupt…”

Boy, if I ever read a prediction that scares the hell out of me, that was the one. What exactly would;d that mean for the country, if over a period of time 20% of everybody were to go belly-up?

Here in the United Snakes we had a hell of a RE mess, but more pronounced in areas where it went totally nuts, parts of FL, Phoenix, parts of CA, Las Vegas (lost wages?) etc.
I don’t know the stats but, I can bet it was not 20% of “everybody.”
In Canada Toronto isn’t Windsor, Calgary isn’t Thunder Bay either. Vancouver is closer to San Francisco without the charm.
What kind of a recession -depression- would 20% BK rate impact everything? I can’t even comprehend the outcome on lives. Ugly, really ugly.

Glad to hear you are recovering and Bandit is there for you.

#5 ILoveCharts on 02.09.14 at 7:31 pm

Bandit sounds like a great dog.

Do you think there will be any news on immigration reform this spring?

This is also interesting:
http://www.scmp.com/news/world/article/1423370/exclusive-vancouver-facing-influx-45000-more-rich-chinese

#6 Randy Macho Man Savage on 02.09.14 at 7:31 pm

Why Is It That For Every Home Posted On MLS, All Descriptions Have Every Word Capitalized? Did Real Estate Agents Learn This Selling Technique In Their Realtor 101 Course?

#7 hohoho on 02.09.14 at 7:32 pm

> … what does he contribute to our economy?

when a new Canadian is not working he is not contributing to our economy, when a new Canadian works he is taking jobs away from real Canadians, is that right?

#8 bill on 02.09.14 at 7:33 pm

very thought provoking Garth.
I am not at all surprised that Bandit stuck by you.
I reckon he would have defended you with his life.
Good Dog Bandit!

#9 tkid on 02.09.14 at 7:36 pm

I vote for an extra biscuit for Bandit! He sounds like a lovely dog!

#10 World According To Garth on 02.09.14 at 7:51 pm

This amount of tax pays for 1/2 of one useless paper pushing govt worker who also do not contribute to the economy. There are 700,000 govt workers in Canada if you include municipal, provincial, federal, contracted road makers, bridge builders and other other shovel leaners, military who just pissed away 10 billion in Afghanistan – and they admit it if you read the latest edition of the Cdn legion and not the crap put out by the controlled main slime media.

Marc’s editorial is sound. Those who think its not have a very short way of thinking (govt worker?).

“First, Marc, HAM means ‘hot Asian money.’ Like from Asia. It’s not a racial epithet for yellow people from Unionville or Richmond who drive Dodge minivans. Get over it. As for the economic contribution this family is making, they paid $32,475 in provincial land transfer tax when they bought the place across the road, and another $31,725 in tax to the municipality, just to have the name of the deed changed. That’s $64,200 in tax.”

#11 mitzerboy on 02.09.14 at 7:55 pm

there is nothing like a dogs love for you

#12 World According To Garth on 02.09.14 at 7:58 pm

Oh….and if anyone says “govt workers pay tax”. No they don’t. If you make 100K and 40k goes to tax but 100% of that COMES from actual taxpayers. How are you paying tax? It would be more efficient if they just paid them 60k. You can’t pay tax if your salary comes from tax. It’s a double negative.

It’s like saying you have more wealth if your salary doubles but so does all the stuff you buy.

#13 KommyKim on 02.09.14 at 7:59 pm

A Realtor that I know just did consumer proposal.
It’s amazing. She only had to pay back 35% of what was owed (Apx 120K) and no interest is paid while that happens. She got to keep her 700K house, BMW, etc….
It’s no wonder why people take that route.

#14 Freedom First on 02.09.14 at 8:00 pm

Interesting post Garth. Made me laugh reading that some people who write you should be locked up, as I hear people talking aloud on a regular basis who fit that description. I have learned, that except around people I know well, not to put forth my thoughts/knowledge on anything, as the thinking of so many people is so dangerous/sickly perverse, not just idiotic like Marc’s, although he may be borderline.

20% bankrupt. Easy to believe looking at the stats of what has happened to people in so many other countries in recent years who have been financially castrated by the same thinking of so many debt ridden, unbalanced, illiquid, house crazed/brainwashed Canadians.

It truly is amazing Garth, being the financially sane man that you are, that on a daily/weekly/monthly/yearly basis, you are able to tactfully deal with so many financially insane via your blog/letters/interviews. Be well, Ironman.

#15 Paul on 02.09.14 at 8:04 pm

#6 Randy Macho Man Savage on 02.09.14 at 7:31 pm

Why Is It That For Every Home Posted On MLS, All Descriptions Have Every Word Capitalized? Did Real Estate Agents Learn This Selling Technique In Their Realtor 101 Course?
————————————————————No It’s 102 Course And Done Automatically By T.R.E.B.

#16 Steven on 02.09.14 at 8:15 pm

Regarding the above picture. Dreaming Garth?

#17 45north on 02.09.14 at 8:17 pm

My beef with HAM is this; the dude across the street has no blinds , no furniture. He seems to wear the same pants everyday and nobody in the house works. So aside from property tax what does he contribute to our economy?

Mark Hanson (writing about the US housing market) doesn’t talk about HAM. I mean he really doesn’t. What if Hot Asian Money has a disproportionately large role in the Canadian market? Like 10 times? Answer: Easy come easy go. When the price of the house across the street doesn’t increase the guy with no job and one pair of pants still has to pay “property taxes of $8,500 a year, plus utilities, insurance and maintenance”. The guy could walk out the door tomorrow – after all he has no furniture. Supposing he paid cash – like $800,000 – well he just puts the place up for sale for $400,000 and gets on a plane. If there’s a mortgage he just gets on a plane. Now Marc you’re going to know right away after all he’s got no blinds but it’ll take the bank six months to figure out the guy is gone.

Marc do you know what’s that going do to your property values? Answer “nothing good”.

#18 crowdedelevatorfartz on 02.09.14 at 8:18 pm

The only thing that scares me more than the statistic for the “average” Canadian debt to income load being at 165%……….
There are tons of Canadians with no debt so that means the actual debt to income for the unfortunate indebted must be even higher than 165%…………

#19 Realtor # 1 GTA on 02.09.14 at 8:18 pm

These rates are the new normal. You will waiting a very long time for rates to go north of 4% for both variable and fixed.

#20 Well of souls on 02.09.14 at 8:18 pm

#5:

if the story behind your link is true, it’s very troubling indeed and makes me despise our government even more…

#21 MrHulot on 02.09.14 at 8:25 pm

Garth, I think you are naive and don’t understand the issues Canadians have with HAM. It’s not racism. It’s the feeling that Canada is being used as a doormat.

Canadians appreciate immigration. After all, we are all immigrants at one time to this country. But Canadians are not in favour of immigrants, whether they are Green, Blue, Black or Asian, jumping the queue just because they have money. This is not the immigrant experience that made this country so great.

When our families came here, most had nothing. They built their lives from scratch, moving slowly up the economic ladder, moving the Country foreword as well, buying into better homes and neighbourhoods as their budgets allowed.

Today, HAM enters with money. They buy the best places in town right off the bat, raising the prices and the ire for locals. For the majority, their only intention is using Canada as a refuge in case anything goes badly in their country. In most cases they leave their families here taking advantage of Medicare and our free education system, never contributing anything to the local economy. If you think paying taxes, buying a new car and some furniture is contributing to the economy, then you are sadly mistaken. In other cases, the entire family goes back, coming back only to keep their landed status then returning. Come to Coal Harbour. On any evening, only 30% of the lights are on. They deposit just enough in the local Banks so interest income does not hamper their ability to pay the least amount of taxes and their ability to even get a GST rebate. LOL

Not saying HAM is only to blame. The Government is more to blame too for facilitating this farce just to get at their cash.

So stop calling Canadians racist and open your eyes.

I understand completely. You resent not feeling superior. — Garth

#22 X on 02.09.14 at 8:30 pm

Unfortunately not enough people have enough skin in the game.

We need big help to get manufacturing going, then, home buyers should have to put 10% down.

It is too easy to get debt, too easy to carry it (for now), and too easy to loose it all if more isn’t done to protect the sheep from themselves.

#23 Al on 02.09.14 at 8:36 pm

“this may be the last Spring”

Is this the last spring? Do we have a hockey stick chart?

#24 Relocated Aussie on 02.09.14 at 8:41 pm

I have been back in Canada for 11 months and have looked at a lot of houses for sale. Unfortunately the only ones that fit my criteria are massively overpriced. Some of those houses are still on the market and others only sold when the price was brought down. They never reached what I would call a realistic level. The sellers tend to be very fixed on their price and lack of a sale never seems to make them think that a serious price adjustment is necessary. From all that I have read about this market it seems that patience will eventually pay off. My question is, When will sanity in pricing prevail?

#25 Victor V on 02.09.14 at 8:47 pm

Three pitfalls to consider before helping your kids buy a home

http://www.theglobeandmail.com/globe-investor/personal-finance/mortgages/resist-the-temptation-to-help-your-kids-buy-a-home/article16599174/#dashboard/follows/

#26 The Patient on 02.09.14 at 8:53 pm

Love the pic. Another brakesider. Inspiring.

Garth, methinks you’ll be riding this spring, or at the latest, late spring…

#27 Linda Mulligan on 02.09.14 at 8:55 pm

Regarding the debt story, it ties in with another statistic I’ve read, in that something like 80% of all major lottery winners are bankrupt within one year of winning the big prize. It also ties in with the saying ‘those who do not learn from history are doomed to repeat it’. Way back in the 80’s when Alberta’s economy crashed & burned, there was an Atco trailer parked at an intersection in Calgary for two years, doing nothing but sell repossessed homes to whoever would take them off the hands of the bank that owned them. Tons of people had been making excellent money, but had spent every cent & more so when they lost their job(s) they lost the lot because the banks would not renegotiate the mortgages. Interest rates at that time for mortgages were in the 21-22 percent range & the banks wanted their pound of flesh. So people walked away, declared bankruptcy etc. Banks cried but no one felt much sympathy, since they were posting billion dollar earnings despite having all the repossessed homes on their books.
Have a question for world according to Garth guy – by his lights if a person is a government employee they pay no taxes because their salary is 100% funded by taxpayers. So what about industries which are heavily subsidized/bailed out by taxpayers? Do the employees of those industries also not pay taxes as per your logic? So Air Canada, Chrysler, GM etc. employees don’t pay taxes because taxpayers bailed those industries out? More than once, BTW. How about fisheries? Farmers? Anyone ever subsidized by the government, ever? Maybe by those light no one has ever been a taxpayer & the taxpayer is a myth…..

#28 Cici on 02.09.14 at 8:56 pm

Darling description of your adorable Dog, Garth!

Can’t wait to hear about how happy he is take that first-in-a-long-time walk with you once the leg has healed.

Cheers!

#29 P.Bocanegra on 02.09.14 at 8:59 pm

#10 “This amount of tax pays for 1/2 of one useless paper pushing govt worker who also do not contribute to the economy.”

This is complete and total nonsense. Please go read an economics text and stop spewing gibberish. Everyone who spends money contributes to the economy.

#30 Linda Mulligan on 02.09.14 at 8:59 pm

Regarding the debt story, it ties in with another statistic I’ve read, in that something like 80% of all major lottery winners are bankrupt within one year of winning the big prize. It also ties in with the saying ‘those who do not learn from history are doomed to repeat it’. Way back in the 80’s when Alberta’s economy crashed & burned, there was an Atco trailer parked at an intersection in Calgary for two years, doing nothing but sell repossessed homes to whoever would take them off the hands of the bank that owned them. Tons of people had been making excellent money, but had spent every cent & more so when they lost their job(s) they lost the lot because the banks would not renegotiate the mortgages. Interest rates at that time for mortgages were in the 21-22 percent range & the banks wanted their pound of flesh. So people walked away, declared bankruptcy etc. Banks cried but no one felt much sympathy, since they were posting billion dollar earnings despite having all the repossessed homes on their books.
Have a question for world according to Garth guy – by his lights if a person is a government employee they pay no taxes because their salary is 100% funded by taxpayers. So what about industries which are heavily subsidized/bailed out by taxpayers? Do the employees of those industries also not pay taxes as per your logic? So Air Canada, Chrysler, GM etc. employees don’t pay taxes because taxpayers bailed those industries out? More than once, BTW. How about fisheries? Farmers? Anyone ever subsidized by the government, ever? Maybe by those lights no one has ever been a taxpayer & the taxpayer is a myth…..

#31 Daisy Mae on 02.09.14 at 9:02 pm

That pic is perfect! LOL Nothing, absolutely nothing, will hold you back this spring…except maybe Dorothy. However, she probably won’t succeed. I believe you’re a ‘free spirit’? Come hell or high water…you WILL ride!

#32 Chickenlittle on 02.09.14 at 9:06 pm

If you make a comment reffering to something specific you have found/read please provide a link!!

It is very frustrating to read comments or facts without a link to whatever you are reffering to.

PS:

Why are the Swiss heros?

#33 Chickenlittle on 02.09.14 at 9:07 pm

*referring….sigh..

#34 walltiger on 02.09.14 at 9:07 pm

#21 Mr.Hulot.
raising the price of RE whether is HAM or the delusional locals benefit Canadians too,just a different group of Canadians.

Most of these supposed rich Chinese Immigrants are in their 40th or 50th. The man usually goes back to China to continue making money, wife and kids will stay in Canada. Since they are relatively young, the drain on the heath system is not severe. The kids will go to school, and its not free, at least not for university. kids graduate, will not go back to China, will stay and work in Canada, and will pay tax. Later on, dad will retire from China, brings all the money to Canada. i don’t see the problem.

#35 recharts on 02.09.14 at 9:08 pm

In a city like Toronto there’s only one housing type which has the potential to better weather an inevitable correct, and that’s a low-rise SFH. Detached best, followed by semis and rows, then condo towns. Buy dirt, in other words, and get through the property storm a little easier.

Of course, that’s exactly why a detached SFH in 416 is pushing $900,000. That and mass, unsustainable delusion.

With all due respect, you are dreaming.
At this moment I am convinced that you have no idea what is going on with the TO RE market. It is understandable… you have no data.

#21 MrHulot on 02.09.14 at 8:25 pm
Garth, I think you are naive and don’t understand the issues Canadians have with HAM. It’s not racism. It’s the feeling that Canada is being used as a doormat.

Keep in mind that Garth might have people in his team who are of Asian descent. Who doesn’t. :D

#21 MrHulot on 02.09.14 at 8:25 pm If you think paying taxes, buying a new car and some furniture is contributing to the economy, then you are sadly mistaken.

He is not the only one on this blog who does not realize that while he is making a profit abroad (x% where 8<x<Infinite) he is losing in a subtle way the same amount at home. Everybody and their Bandit should invest in stock markets and (W/E)TF or something else. Sell Canada and buy America. I am quite sure that when this country will go to dump all the guys like can go back. I just don't know where guys like you will go.

#36 Shawn on 02.09.14 at 9:11 pm

Bashing Government Workers is NEXT Week’s topic

World According to a victim at 10 (and 12) said:

This amount of tax pays for 1/2 of one useless paper pushing govt worker who also do not contribute to the economy.

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

Dude, TODAY’s blog is devoted to blaming your lack of success on HAM. And being jealous of HAM. Bashing government workers and being jealous of them is a topic for another day.

And when that day comes you can think about why the private sector is so dumb as to elect people who hired all these so called useless and over-paid people. And why you did not score such a plum job yourself.

And maybe tell us what wonderful things you yourself contribute to society, besides your jealousy and negative attitude that is.

Actually we ALL benefit from the economic system that has been set up and largely managed by government. Things like the rule of law and enforcement of contracts and public infrastructure like roads and schools. The private sector can’t exist without those.

Every single one of us owes our success to some degree to the society we live in. Don’t believe it? Move to some remote part of the world with no economic system and see how you fare. Taxes may be low, but living standards will be much lower.

#37 Mishuko on 02.09.14 at 9:12 pm

Firstly, thank you greatly Garth. I had a spill commuting from scarberia to the basement of the big red granite’s basement. Those darn tracks and skinny tires seem to be a match from heaven. Luckily only my helmet cracked on the endo and nothing else. Get well soon!

Whenever me and my friends refer to HAM, we always knew it as hard arse mofo. Or as you guys know it as hornies.

Regardless a name is a name, as the principle is the same.

As much as I want to say stop giving away such pathetic advice, many still won’t heed. I for one have learned a fair amount for my short 6m here.

#38 World According To Garth on 02.09.14 at 9:13 pm

Its amazing how those who dispute never ever have a written alternative. Only ever name calling or “yer wrong”. If everyone worked for the govt, where would said taxes come from to pay all the pencil pushers to spend into the economy professor?

#29 P.Bocanegra on 02.09.14 at 8:59 pm
#10 “This amount of tax pays for 1/2 of one useless paper pushing govt worker who also do not contribute to the economy.”

This is complete and total nonsense. Please go read an economics text and stop spewing gibberish. Everyone who spends money contributes to the economy.

#39 Herb on 02.09.14 at 9:15 pm

#10 WorldAccordingtoNobody,

all right, you “useless paper pushing govt worker[s] … municipal, provincial, federal, contracted road makers, bridge builders and other shovel leaners, military …” doctors, nurses, firemen or whatever, you heard the lady/man!

Put down your pencils, instruments, shovels or whatever tools you’re resting on, and see how girlfriend/buddy likes it!

#40 T.O. Bubble Boy on 02.09.14 at 9:24 pm

Detached best, followed by semis and rows, then condo towns. Buy dirt, in other words, and get through the property storm a little easier.

Of course, that’s exactly why a detached SFH in 416 is pushing $900,000.

Detached SFH in 416 are also pushing $900k because CMHC insures almost anyone, as long as the price is under $1M.

When I see a standard detached SFH in Midtown/North Toronto come on the market (3 bdrm / 2 bath, basic renos, nothing special), I simply assume that it is priced between $995,000 and $999,999. And, in most cases, I’m precisely right.

2 examples on the same street!!!

http://www.realtor.ca/propertyDetails.aspx?propertyId=14005191&PidKey=-518714572

and

http://www.realtor.ca/propertyDetails.aspx?propertyId=14042983&PidKey=2135008228

and, one more for good measure (less renos, but wider lot):
http://www.realtor.ca/propertyDetails.aspx?propertyId=14037532&PidKey=-1039447640

#41 Brian Ripley on 02.09.14 at 9:26 pm

“News flash, Rod. It is Spring.” said Garth

The seasonal cycles of sales and listings is indeed playing out (in the GTA, both sales & listings have ticked up off the bottom): http://www.chpc.biz/sales-listings.html

BUT… the Monthly Absorption Rate in GTA is falling and the Months of Inventory is rising, and that’s a negative for vendors: http://www.chpc.biz/mar-moi.html

#42 Paully on 02.09.14 at 9:31 pm

I hate hearing all of the commercials for the debt councillors and bankruptcy trustees. They advertise how a consumer proposal can get you out of debt…sure, by screwing everyone that loaned you money. Once you are in proposal, you can’t finance the steam coming off a hot lunch. Proposal won’t feel nearly so good when you are in your fifties and have to ask your kids to co-sign for a crappy used car!

#43 Vancouver Goin Up on 02.09.14 at 9:32 pm

http://www.theguardian.com/money/2014/feb/07/local-buyers-first-refusal-new-homes-labour

Mr Hulotid dead on. Garth’s response dead wrong.
New trend on the horizon. Folks Vancouver has been unstoppable. Changing laws is the only thing that can stop us. Higher interest rates, debt load talk, jobs, incomes is pure nonsense. Vancouver is a store house of wealth. Folks Ive been pounding the table for years regarding loading up on Vancouver. New laws being proposed and political pressure may be a trigger to sell. I thought I would never have to entertain this idea. Stay tuned.

#44 baddog on 02.09.14 at 9:33 pm

20% sounds really dramatic. Are you suggesting that millions of Canadians are going to go bankrupt en masse in the next few years or that 20% will experience bankruptcy in their lifetime (70ish years)? Sounds like a bit of a stretch either way. Of course I could be wrong.

#45 Daisy Mae on 02.09.14 at 9:34 pm

“As for Bandit, thanks for asking. When I tumbled he lay beside me. When I crawled home he crept with me. When he hears my crutches he wags furiously. When I grow sad he sticks a giant, sticky, wet, hairy, peanut butter-encrusted protrusion in my face. I am blessed.”

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

What about Dorothy? She said: “Holy shit!” when she saw your sores….has she softened? LOL

#46 Grantmi on 02.09.14 at 9:38 pm

http://www.theglobeandmail.com/news/world/swiss-vote-split-on-reintroducing-immigration-quotas/article16765398/

The SWISS….

#47 TRON on 02.09.14 at 9:40 pm

I have a number of friends where I live in North Vancouver who have business or do business in China; a couple of them are from mainland China.

They understand that the Chinese government can seize assets at any time and there is nothing that can be done about it. This is the primary reason that mainland Chinese people buy property in Canada, the US and Europe. What they pay for the property is much less important than getting as much of their money as possible out of China.

I’ve lived in the lower mainland for 35 years and watched the demographic change. The last 15 years have been dramatic to where my children were 2 of 5 Caucasian kids at a school where 30 years ago the ration was the opposite.

This is my opinion and I don’t have the demographic facts to prove it however it is what I have witnessed first hand. Until someone can prove this to be different without using the easy ‘you’re a racist’ card I’m hard pressed to agree with those who say the mainland Chinese are not keeping prices high.

The stock market refers to investors who bring in big money as ‘whales’. The whales provide the confidence to the market for the rest of the retail buyers. The real estate ‘whales’ are from Mainland China and people here think they’ll keep coming and their housing investment will do nothing but go up.

#48 sheane wallace on 02.09.14 at 9:43 pm

Surely there are different value systems, some people are willing to take on more risk to get that house, for some housing is a cult, tradition.

Why don’t we let the markets decide and price the risks accordingly? Disband CMHC, fire F with no pension, let the banks take the risk for the loans they make and profit from, get the central banking out of setting interest rates and then watch the show. I guarantee at least 60 % drop in house prices.

But to manipulate the markets by assuming significant system breaking risk at taxpayers expense and at no cost so the banks can profit with no skin in the game?

NO, THANK YOU.

There always will be debt junkies wiling to bet their live on that house, I just don’t want to be the one paying for their’s and the government’s stupidity.

It can clearly be seen that if this goes for a while longer there would be an inescapable currency crises that will devastate savers and retirees. Smart people hedge accordingly.
But the fall in terms of jobs lost and capital miss-allocation would be horrific.

And no, I am not paying windfall taxes on investments.

#49 White Van Man on 02.09.14 at 9:43 pm

For comment #77

I’m a new immigrant to Canada from the UK. I work with Canadians who want great paying jobs but not prepared to get a costly education that pays well. Employers will recruit overseas skilled people who have the skills and education Canadians are not prepared to work hard for.

No ones fault except your own!

#50 Linda Mulligan on 02.09.14 at 9:44 pm

Actually, oh world according to Garth dude, we ALL work for the government for something like 7 months of the year – ever heard of ‘tax freedom day’ when the worker has ‘finally’ paid all the taxes owed? If then you throw in all the subsides paid to various businesses etc. by that self same government, it pretty much follows that we are all of us working for the government 100% of the time & thus according to your logic we none of us pay taxes. BTW, nurses, doctors, fire fighters, police are all of them government workers. You may not think they provide valuable services but I’d say you are in the minority there. Nor have you answered the question as to whether companies/industries that have been bailed out by taxpayers (who happen to include those self same government workers, like it or not) should not also be considered to not pay taxes since the money that has been used to pay the employees was tax payer funds. Or is it that you work for one of those bailed out or subsidized industries & your logic has come back to haunt you?

#51 Daisy Mae on 02.09.14 at 9:45 pm

#11 mitzerboy: “there is nothing like a dogs love for you”

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

All pets are wonderful! So loyal, so forgiving…so everything.

#52 pinstripe on 02.09.14 at 9:45 pm

Indicators are that next week the fed budget will focus on helping the middle class. How did F become so concerned about the middle class?

At the same time, the feds are reducing the civil servant numbers by attrition with retirement, only to learn that these same people might be re-hired to do the work, at double the pay but no benefits. The benefits are already covered by the retirement package.

Why is so easy to fool the taxpayer?

#53 Dave on 02.09.14 at 9:51 pm

Garth, just in case you feel as though your message isn’t getting through, one of my neighbors called me a few weeks ago and asked why I’m renting instead of owning… I told her why. She didn’t really need any convincing.

(I used to own in the same complex but now rent and thanks to the $$$ I got – invested in ETFs and preferreds, live rent-free)

She’s already sold her place to a Greater Fool who paid much more than I thought the place was worth and will be downsizing and renting as well.

Some friends also recently sold their place as they are well into retirement and have several health concerns. Their Realtor convinced them to list in January to get a jump on the “spring” rush, price it to sell and they got more than one offer, selling for over list. They’re renting as well. Not everything is perfect with their rental unit and the cheap-ass landlord, but better than having a house that needs a LOT of maintenance and upkeep – when you’re unable to do either.

#54 hohoho on 02.09.14 at 9:55 pm

> … they leave their families here taking advantage of Medicare and our free education system …

oh yes, free medicare and education once you pay 1.8M …

> When our families came here, most had nothing.

I think there is a big line of people with nothing waiting to come to Canada, maybe we should take in more of them instead?

#55 Herb on 02.09.14 at 9:57 pm

#32 Chickenlittle,

here’s your answer:

http://www.cbc.ca/news/world/swiss-voters-narrowly-back-plan-to-limit-immigration-report-says-1.2529308

Don’t knw why that would make them heroes. They’ve always been particular about immigrants, except for wealthy ones, of course.

#56 sheane wallace on 02.09.14 at 9:59 pm

Rich Chinese drive house prices up?
Great, then disband CHMC!

I would start posting here on daily basis like Marcus Porcius Cato’s famous:
“Carthago delenda est”, or “Carthage must be destroyed”

the following:
“CHMC must be disbanded”

“CMHC delenda est”, thi si a great name for a book I intend to write.

#57 *NAKED APE* on 02.09.14 at 10:00 pm

@ #12 The World According to Garth…

I, personally, am getting quite tired of your rants against civil servants.

Maybe pick a better cause, (?) – like how this Harper Government is attacking Seniors, Unions, Veterans, muzzling Scientists, Environmentalists and attempting to squash legitimate charities, shutting down research stations, killing the Census, spying on our citizens, attacking democracy and rigging elections laws. And we still don’t know if they are legitimate because H has cut the nuts off Elections Canada now as well.

And while you’re at it, maybe question the requirement for shipping armored vehicles overseas to India, junkets for 200+ religious friends to Israel for what, costs of F-35s?, gazebos and fake lakes, helicopter rides, bogus photo-ops, a budget that has never ran in the black since F came into the picture, why the necessity for an Office of Religious Freedom, the Senate scandals, trashing the EU system and why we need to move the OAS pension to 67? Just to name a FEW………………

Take your pick sir, but back off on attacking those of us who also pay taxes and contribute in the same way to society as YOU do in this fine country of ours.

#58 Aggregator on 02.09.14 at 10:02 pm

At least one country is doing something about hot foreign inflows and non-employed immigrants before they bankrupt the entire country:

Swiss Housing Market Bubble Looms Closer, UBS Says

Switzerland’s property market is at greater risk of overheating, raising the question as to whether authorities have done enough to curtail the boom.

 Swiss Vote to Curb Immigration in Referendum

Switzerland voted in favor of new immigration curbs, risking a backlash from the European Union and thwarting the ability of companies to hire top talent abroad.

The measure, which requires the government to set an upper limit for foreigners, was supported by 50.3 percent of voters, the government said at a press conference in Bern. Voters in the cities of Zurich and Basel and cantons in western Switzerland opposed the measures, while those in rural German-speaking cantons and the Italian-speaking region of Ticino backed it.

No correlation here. Move on now.

#59 Sign of the Times on 02.09.14 at 10:02 pm

With all the talk around layoffs, bankruptcies and “tough times” in the economy I thought I’d share another anecdote from The Best Place on Earth. BIL owns a Shoppers Drug Mart, he’s an associate owner, and just got word that his store exceeded expectations – significantly. The bonus this year is $100k, on top of the $120k salary he earns, all for working 20 hours a week and making sure they continue to keep the drugs flowing.

Maybe there is some merit to the Vancouver wealth theory? There’s a lot of pharmacists in Vancouver, as there are lawyers, doctors and other professionals so if this salary is indicitive of what others in the field are making maybe our real estate prices are justified?

In the spirit of disclosure the wife and I both make over $100k each yet wouldn’t think about buying yet…

#60 Oceanside on 02.09.14 at 10:05 pm

29 P.Bocanegra on 02.09.14 at 8:59 pm
#10 “This amount of tax pays for 1/2 of one useless paper pushing govt worker who also do not contribute to the economy.”

This is complete and total nonsense. Please go read an economics text and stop spewing gibberish. Everyone who spends money contributes to the economy.
+++++++++++++++++++++++++++++++++++++
Well said, highways, hospitals, schools, dams, ports…Maybe we should let Conrad Black types look after these necessities…I worked for various governments most of my life, paid the most tax with no breaks…My friends in business write off everything and have good lives without paying hardly any taxes.

#61 MrHulot on 02.09.14 at 10:06 pm

#55

Pay 1.8M for a chance to get their money out of China and an asset they assume will rise in price. Win, win for them

I prefer an immigrant with no money but a REAL commitment to Canada then someone with money that chooses Canada just as a temporary convenience.

#62 walltiger on 02.09.14 at 10:08 pm

#54 hohoho

well said.

#63 hohoho on 02.09.14 at 10:08 pm

> What they pay for the property is much less important than getting as much of their money as possible out of China.

it almost sounds like buying Canadian RE is the only way to get money out of China …

#64 The federal government built the HAM factory on 02.09.14 at 10:11 pm

All human history involves race mixing and multiculturalism, it is- natural. I enjoy the vibrancy of multiculturalism, but I don’t agree with it as policy (Bob Rae:’white males to the back of the line’). When the government creates something called ‘official multiculturalism’ it is not natural, it is social engineering. As long as they can get you asking the wrong questions they don’t have to worry about the answers. The right questions are ‘who?’ is behind the social engineering and ‘why?’ No one asked for it. Trudeau was the front man of the operation. A French conspiracy to dilute Anglo power? I doubt it. A UN initiative to dilute resistance to a ‘world order’ ?
If I had to use one word to describe the typical mass of recent immigrants to the GTA it would be ‘primitive’, obviously there are lots of exceptions. But this IS what the government wants. Why?

Primitive. What a disgusting comment. This thread will soon be ended. — Garth

#65 sheane wallace on 02.09.14 at 10:12 pm

#57 Sign of the Times
……………………………
Associate pharmacists are few.
New grads make 30-40 per hour as relieve pharmacists with a promise of 100 k if lucky to find full time job. For pharmacists there is no such thing as salary increase with seniority,

And just wait until associate structure is changes then they will dream about 1/2 of that salary.

#66 DreamingInTechnicolour on 02.09.14 at 10:14 pm

http://qz.com/143017/beijing-goes-hunting-for-overseas-real-estate-by-corrupt-officials/

#67 timmy on 02.09.14 at 10:25 pm

Marc,
you should know by now that our Government doesn’t care about its people, that’s why they encourage foreigners to come here and bid up land prices, disenfranchising those who were borne here. They don’t keep tabs on how many places are owned by offshore interests or people with shady backgrounds trying to hide their money somewhere. It would be so easy for them to do this, yet they don’t. That’s why big cities are being overrun by HAM

What a sad bunch of losers here tonight. — Garth

#68 CalVulture on 02.09.14 at 10:28 pm

If there are no dogs in Heaven, then when I die I want to go where they went.
Will Rogers

#69 Suggestions please on 02.09.14 at 10:30 pm

I am putting $25,000 ( I know it is not much) into a TFSA. It is under my limit.

I would like to diversify with Dividend producing shares in RBC, ETF’s, REIT’s, Bonds.

Any specific ideas would be greatly appreciated

#70 Sign of the Times on 02.09.14 at 10:32 pm

#65 Sheane Wallace
———————
It sounds like you’re more in tune with this space than I am :)

It’s clear there’s an imbalance in salaries in that particular job function for that particular company and in this particular city and they happen from time to time. To be honest though, if one was confident they were going to continue to make that sort of income going forward I could see why they wouldn’t worry about making the wrong decision with respect to a home purchase.

What, if any, changes do you see coming to the Associate Structure? It sounds like gumdrops and sugar cookies from everything I hear in my discussions and it would be nice to have some facts in my back pocket to “fight back with” :)

#71 gtrz4peace on 02.09.14 at 10:33 pm

@#57 “NAKED APE”

Bravo. This blog can seem like a sea of sheeple righties, and the damage that Harper is doing — as Canada marches towards a “soft totalitarianism” like the US — needs to be called out. Hubby is a UNION member and proud teacher, they work their asses off for peanuts — together we have been members of 3 unions. We need to strengthen Labour again, not defund it. Strengthen the public sector, not kill it as those masquerading as libertarians but are actually corporate shills would like. People need to read history and understand it.

#72 RP on 02.09.14 at 10:34 pm

I feel like one thing people overlook is the idea of globalization. Wince we are part of a global society, trade continually opens up between countries which really means that price discreprancies for similar products in different countries will gradually equalize.

The reason why I am pointing this out is because whether its HAM, HMEM (Middle Eastern Oil) or whatever Hot Money there is, globalization is essentially making sure that the most wealthiest whether from Canada, US, China, Dubai or wherever will have access to buy what they want over the others in wherever the place, be in Vancouver, 416, or Sydney.

The reverse is also happening when it comes to jobs and costs. We outsource to the cheapest producer and we sell to the highest bidder.

We all would do the same if given the chance – we probably have – the only difference is that many of us are not at the top of that pyramid right now and are pissed off about it. I am nowhere near the top of the pyramid, but at least I know I don’t try to live like I am at the top of it. That is what’s going to cause the pain for many. Those who tried to keep up with those above them but simply fueling it with debt.

#73 walltiger on 02.09.14 at 10:38 pm

#61 Mr. Hulot

“chooses Canada just as a temporary convenience.”

every type of immigrants to Canada has a different story. some came with money, some didn’t, in the long run, none of these are of any importance. they will all in one day be Canadian and contribute to our country, so why not let people with skills, brain and yes, money come instead otherwise.

#74 Axxman on 02.09.14 at 10:43 pm

The house I rent just went up for sale – lowest priced place in the hood with very few others on the market. Only 3 calls in the first week. Yes, inventory is low – but demand seems to be even lower. Market seems to be shifting gears from moderate supply-high demand to low supply-lower demand…next gear is when unemployment in the GTA sticks at over 10%…that’s when the high supply-mderate demand market emerges…for a very very long period of time.

As for the Swiss – good on em – they will never let outsiders f-up their country…lived there and saw it first hand. It works….

#75 Ronaldo on 02.09.14 at 10:48 pm

20% eventually going bankrupt. Wow.

Considering bankruptcy? Start here.

http://www.ic.gc.ca/eic/site/bsf-
osb.nsf/eng/br02051.html

#76 walltiger on 02.09.14 at 10:49 pm

#67 timmy

agree with Garth, you are such a loser.

if you want Canadian cities to be world class cities, you have to attract the brains and money. not all rich immigrants are crooks, most of them are legitimate business men and their presence (or their off springs) here will one day benefit our country. do you rather want to see boat loads of refugee come to our shore everyday? maybe you do, so you can feel superior.

#77 Smudgekin on 02.09.14 at 10:51 pm

1 Bloor is going up slowly but surely. The ceilings from the third level up appear low. In a way the slow pace of construction reminds me of the opera house built at Richmond/University.

#78 Basil Fawlty on 02.09.14 at 10:55 pm

#10 World According to Garth:
“This amount of tax pays for 1/2 of one useless paper pushing govt worker who also do not contribute to the economy.”
This over generalization/rant sounds more like the world according to Kevin O’Leary. In other words it’s nonsense. I hope the next time you need a nurse she leaves the bedpan on your night table.

#79 Aggregator on 02.09.14 at 11:02 pm

Hey about those wealthy investors that were suppose to settle in Quebec but ended up fleeing to Toronto and Vancouver. Infographic Keep up the good work CIC. You're doing a great job at finding all the wrong people.

And if you don't live in Canada or are waiting at on CIC's backlog, that's ok, you can just browse Canadian properties from unofficial MLS Canada websites and speculate from abroad.

VanFun.com (see partner links at the bottom)

Juwai.com

Does anyone realize what would happen if this was a financial company selling Canadian equities from abroad? Regulators would be all over them. Ahh, but not for Canadian RE, where there are no rules and properties can be sold for cash to anybody breathing with absolutely no oversight, including criminals and corrupt officials

I just found out Ontario's Land Registry System is in partnership with a private company. So you can forget about foreign ownership statistics for Ontario. That ain't happening.

Everything is controlled. There is no free market anymore. It's just government, banks and a lot of damn crooks with the same goal of transferring more wealth from your bank account to their pockets.

I can buy property in Spain. And they give me a residency card for doing it. Take the tin foil off, dude. — Garth

#80 sheane wallace on 02.09.14 at 11:03 pm

What, if any, changes do you see coming to the Associate Structure? It sounds like gumdrops and sugar cookies from everything I hear in my discussions and it would be nice to have some facts in my back pocket to “fight back with” :)
—————————–
associate model is unique. It allows for sort of joint ownership where associate receives salary, and percentage of sales based on formula acting as manager as according to Canadian laws the owner and the person on the hook of a pharmacy established after I believe 1959 must be licensed pharmacist
It is not clear whether the new owner can run pharmacies based on the 1959 exception without associates.

However either the new owner or the government with it’s generics price control will I believe reduce to some extend the associates income. Not to speak that only lucky few (1300 stores in canada) can be associates,

#81 Min in Mission on 02.09.14 at 11:03 pm

When I retire, there is one thing I going to do right away.

No. It is not “sell the house”

I’m getting a dog.

#82 Keith in Calgary on 02.09.14 at 11:05 pm

Today the Swiss stood up to the unelected swine in Brussels and literally told them to go “F” themselves.

That is why they are heroes……been to Zurich a few times myself, and know a few Swiss to boot. The people there are not dumb and didn’t fall for the propagandist scaremongering bullshit that wold have been spouted by the EU assholes bound and determined to have their way in trying to sway this vote.

In Switzerland there are 4 languages that are spoken (French, German, Italian and Romansch) and the people who live there come from several countries.They are not anti-immigration, or racist in the slightest. But they all share a common trait……a desire to control heir destiny, in their way. Something that can’t be said for the muppet lemmings here in North America.

#83 Poorgeoisie on 02.09.14 at 11:05 pm

Number of super rich Chinese people that I know with houses in Canada: 0
Number of 25-30 somethings I know maxed out on mortgages in Canada: More than half
Ask yourself the same question (answer honestly) and stop blaming the boogey man.

#84 DR on 02.09.14 at 11:09 pm

and, one more for good measure (less renos, but wider lot):
http://www.realtor.ca/propertyDetails.aspx?propertyId=14037532&PidKey=-1039447640

If two bungalows sold last week for over 1M.
what would this sell for? It actually looks like a nice house. and its a two storey.

#85 dodgedbullet on 02.09.14 at 11:09 pm

Come on Garth, as soon as you mentioned HAM there were always going to be vitriolic responses.

Did you mean to bait?

GWS.

#86 sheane wallace on 02.09.14 at 11:12 pm

http://business.financialpost.com/2013/07/20/shoppers-drug-mart-loblaw-pharmacist-associate/

#87 not 1st on 02.09.14 at 11:15 pm

Garth, all your advice is for not because soon the illuminati new world order will execute Agenda 21 whereby they will confiscate all guns and gold and crash the stock market and move 99% of the population to FEMA concentration camps where you will be forced to have flu vaccinations and drink fluoridated water while you are sterilized and and have a RFID chip inserted so your movements and shopping habits can be tracked by Google and the NSA.

#88 -=jwk=- on 02.09.14 at 11:16 pm

@ #19 realtor
US rates for 30yr are at 4.125, and going up. Canada to follow as the bond market is global…

#89 TheCatFoodLady on 02.09.14 at 11:17 pm

Oh goodie – just enough time before The Walking Dead to be ponderous & pedantic again. The intergenerational sniping I’m seeing is pointless. None of us had control over when we were born or the circumstances in which we found ourselves growing up. Rich kids can piss away their patrimony in a few years of indulgence while some who could barely get a meal a day find themselves, by hard work, secure by their mid 30s.

In Canada, it all comes down to choices once we hit adulthood. At times we’re all going to make bad ones; we’re human. What matters is what we learn from them; how we change our behaviour as a result of our own stupidity. Each generation, each cohort has faced challenges & hardships. And each generation has seen members thrive & members sink.

None of us are guaranteed anything – not opportunity, not success, not health, not happiness. All we can do is assemble the best tools we can muster & try our damnedest.

Some us right now, through circumstance, life’s hard knocks or sheer & often repeated stupidity, are standing on a cliff’s edge while others are meandering or willingly galloping closer to it.

So… stop. Figure out what’s not working. Change it. When it comes to finances, assume & plan for the worst & hope for the best. Low interest rates are a boon to the indebted – stop spending & get busy paying off what you owe. Sell the millstones around your neck & granite, no matter how pretty weighs a ton if it ain’t paid for.

Kids – no more bullshit, no excuses. No jobs where you are? If mom & dad are willing to put up with you living at home but seeing no more of you than your ass sticking out of the open fridge, maybe, they’ll be willing to spot you a ticket to where there are jobs.

Boomers without a buck? There are a lot of us out there & we’ve no one to blame but ourselves. I don’t recall anyone pointing a gun to my head when I made, (too many!), stupid financial decisions. If many of the Greatest Generation are sitting on mountains of cash, an equal number quietly live in poverty with no complaint. Either way, I doubt many of them have the health left to feel ‘great’ anymore.

With debt levels where they are, how can this not all go very badly for many at some indeterminable point? It’s very true that if the average debt sits at 165% of disposable income, many of us don’t have debt. To me that can only mean some are so at the limit & beyond, I don’t know how they sleep at night.

The housing market will be obnoxiously exuberant this spring – last kick at the cat, I suppose. In the last many weeks since Christmas every time I’ve been to Crappy Tire, I’ve seen a load of people in the sections you’d expect if they’re prepping a house for sale. I’ve overheard loads of talk about neutral paints, have seen more cheap brushed nickel door handles for kitchens, towel racks, new light fixtures, (also cheap); all the ‘fixie uppie’ things you buy when you’re prepping a house for sale.

I haven’t seen new listings yet, just a lot of very stale listings without the required price reductions. A lot of places were simply taken off the market & will be put back on over the next few weeks.

Interesting times…

#90 KommyKim on 02.09.14 at 11:25 pm

RE: #42 Paully on 02.09.14 at 9:31 pm
Once you are in proposal, you can’t finance the steam coming off a hot lunch. Proposal won’t feel nearly so good when you are in your fifties and have to ask your kids to co-sign for a crappy used car!

Nope. It’s not that hard. The bad credit rating only remains for 3 years after you’ve finished the CP process.
ie: So if part of your consumer proposal is to pay off only 35% of the debt within 3 years, then it only takes 6 years from filing to lose that bad credit rating.

Not bad if you think “I owe $100K. I must only pay $35K over 3 years. Wait another 3 years. Get a new VISA card. Gee… I got $10,800 per year for 6 years for free.”

#91 MrHulot on 02.09.14 at 11:35 pm

#73 Walltiger

No problems with people with skills, brain and money. Only a problem with people with only MONEY. In Canada, 800K gets you into Canada with no skills or brains.

The investor immigrant program is suspended. — Garth

#92 Devore on 02.09.14 at 11:36 pm

#241 Kaganovich

They (Ralph Cramdown, Devore, Eaglebay etc.) set out to naturalize the situation we are in, and thereyby dissuade those who think it is amenable to change by political means (albeit, formal political channels look futile right now). They are simply part of a dwindling few who benefit from this system we are all in.

I don’t think that at all. I am simply a pragmatist, not a dreamer who stakes everything on the way things should be, and rages when he’s inevitably wrong.

I think everything is very much amenable to change, and I hope it does.

#93 NFN_NLN on 02.09.14 at 11:42 pm

HAM is to Canadians as European settlers were to the Indians.

Read into that what you will…

#94 MrHulot on 02.09.14 at 11:53 pm

#84 Poorgeoisie

“Number of super rich Chinese people that I know with houses in Canada: 0”

You need to get out more

#95 OttawaMike on 02.09.14 at 11:57 pm

No doubt our 1/4 million annual immigrants help sustain growth in our real estate sector not to mention consumer goods. My family did the same 60 years ago and I am no xenophobe.

The old saying goes that every rumour has some truth in it and the underlying rumour that I keep hearing is that some of the foreign investors(who may or may not be landed immigrants) are using our loosey goosey FINTRAC regs to clean their dirty money in our chaotic housing bubble.

http://www.fintrac-canafe.gc.ca/re-ed/real-eng.asp

The ultimate goal being a backdoor route to repatriate the cleaned cash or funnel it into US ventures without any uncomfortable questions.

The fact that the Harperites don’t track foreign RE purchases just bolsters the theory of our government’s complicity in a scheme to pump up our economy with offshore currency.

There is certainly more to this bubble story than a bunch of zombie debt tolerant Canadians.

#96 Aggregator on 02.10.14 at 12:08 am

I can buy property in Spain. And they give me a residency card for doing it.

And how did that reckless policy work out for Spain Garth? Charts

Are you saying mass immigration is a good trade off for higher youth employment? Because that's what's already happening and where Canada is heading. Broke, like Spain.

There's a difference from today's immigration policy compared to the early 1900s who were handed shovels and hammers and told they must work. Today, immigrants are told they will receive a good job, free health care, welfare if needed, maturity pay, pension payments and, if they need a mortgage a Canadian bank will be glad to offer them one, even before they step foot on Canadian soil!

This isn't productive economic policy. This is looting and misleading foreigners to believe Canada is some sort of Disneyland.

Canada is not going to avoid becoming like Japan by adopting what Ireland, Spain and other countries with high immigration already tried. They all failed and Canada will too.

BTW, when I said they were ramping up immigration to 600k annually (of which 80-100k will be students), by 2018, I wasn't kidding.

#97 nonplused on 02.10.14 at 12:24 am

Bandit is one man’s best friend. God bless dogs, and anyone who thinks they don’t go to heaven has their head up their Bible.

I just recently took a tumble myself down the stairs. It turns out that if you have one of those stair cases that turns half way down anything or anyone large and heavy hits the wall before proceeding the remaining distance to the bottom. I put a hole in the drywall but it’s been relatively inexpensive to fix. I hurt my hand, but not bad. You had a much worse fall Garth. Best wishes again and keep up the good work but take a break if you need to.

And God bless those dogs. I mean, they do hope for our help when they bugger up and we give it to them, and they can’t help us back the same way. But you know they do what they can. They care.

Anyway, the point of this story is that before I could even assess my injuries and was still figuring out what happened, our loyal family dog was already on scene offering his assistance and compassion, such as it was.

#98 Fort Mac Flatlander on 02.10.14 at 12:40 am

Good evening Blog dogs,

With the unaffordability of housing in the area, work has agreed to kick 100k over 5 years towards housing relief if I buy, which according to my numbers makes it work over renting. Should i go ahead? Looking at a condo $350-450.

#99 espressobob on 02.10.14 at 12:54 am

#69 Suggestions please

The problem is with regard to risk tolerance & time horizon? You might want to consider an advisor on this matter?

#100 Mr. Monday Night on 02.10.14 at 12:55 am

#90 KommyKim on 02.09.14 at 11:25 pm

“Nope. It’s not that hard. The bad credit rating only remains for 3 years after you’ve finished the CP process.”

——————————————

This is true from most people I’ve come across who have gone through the CP or bankruptcy process. However, like most people who get something for nothing, they have no appreciation for what has just happened, so they go about racking up fresh debt as soon as they can, albeit at higher rates now that they are a greater credit risk.

Not many folks out there who learn their lesson from bankruptcy or CP and reign in their spending habits for good. Doubtful that they’ll ever see a prime rate in their lifetime, let alone a house.

#101 saskatoon on 02.10.14 at 1:12 am

#73 Walltiger

The investor immigrant program is suspended. — Garth

Garth,

I don’t think that the program is actually ‘suspended’…they are just severely backlogged…so, in other words, no new applications until they wade through the 1000s already received.

Apparently, the Quebec program is ongoing.

#102 Carpe Diem on 02.10.14 at 1:23 am

I feel so dirty.

Last year we had no debt.
This year we have 5K of debt.

5K debt … I believe because I dropped that on some REIT or something. But I have a line of credit…. and I dislike that.

I rent an awesome 2 acre treed lot and home … I’d never buy at these prices … it’s all about knowing hold vs fold …

The school person reacted strangely when I told her I rented.

Why? simple … because my return on investment is and will be much more elsewhere.

We are now on a budget to kill this 5K in 3 months.

Plus, keep on that budget to start saving for the next WHATEVER!

We are renters and do not need to worry about the driveway, the roof or the furnace.

We we freemen (and woman).

#103 Humpty Dumpty on 02.10.14 at 1:32 am

The clock is ticking. Every second, it seems, someone in the world takes on more debt.

http://www.economist.com/content/global_debt_clock

Someones debt becomes someone else’s asset… No

#104 Bill Gable on 02.10.14 at 1:34 am

Bandit sounds like a very special friend. I hope you are blessed with many more years of his love and comfort.

He is also smarter than a lot of the schnooks buying these 400 foot cages in the sky, here in Vancouver.

#105 MrHulot on 02.10.14 at 1:39 am

#91

The Immigrant Investor Program (IIP)

Garth, you are wrong. This program is not suspended. They are not accepting new applicants for the moment as they need to focus on processing a huge backload.

Also, Quebec which is the main culprit is still accepting immigrants on this program as they know they will get the money and the immigrant will likely go to Vancouver

#106 Patience Is A Virtue on 02.10.14 at 1:45 am

#58 “No correlation here. Move on now.”

You’d better believe there’s a correlation:

http://fra.europa.eu/en/press-release/2010/leading-european-rights-agencies-warn-economic-crisis-fuels-racism-and-xenophobia

http://www.csmonitor.com/Business/Robert-Reich/2010/1011/Xenophobia-and-the-economy

#107 Vancouver GoinUp on 02.10.14 at 2:05 am

Whoa whoa whoa there cowboy. Forget your personal experience, forget house prices that have no correlation to income. North and West Van has plenty of money coming from the Middle East amongst other places BUT According to Garth and I quote
“I understand completely. You resent not feeling superior. — Garth.” You are wrong Tron. You have been hallucinating.
#47 TRON on 02.09.14 at 9:40 pm
I have a number of friends where I live in North Vancouver who have business or do business in China; a couple of them are from mainland China.

They understand that the Chinese government can seize assets at any time and there is nothing that can be done about it. This is the primary reason that mainland Chinese people buy property in Canada, the US and Europe. What they pay for the property is much less important than getting as much of their money as possible out of China.

I’ve lived in the lower mainland for 35 years and watched the demographic change. The last 15 years have been dramatic to where my children were 2 of 5 Caucasian kids at a school where 30 years ago the ration was the opposite.

This is my opinion and I don’t have the demographic facts to prove it however it is what I have witnessed first hand. Until someone can prove this to be different without using the easy ‘you’re a racist’ card I’m hard pressed to agree with those who say the mainland Chinese are not keeping prices high.

The stock market refers to investors who bring in big money as ‘whales’. The whales provide the confidence to the market for the rest of the retail buyers. The real estate ‘whales’ are from Mainland China and people here think they’ll keep coming and their housing investment will do nothing but go up.

#108 Retired Boomer - WI on 02.10.14 at 2:06 am

# TheCatFoodLady

Well said…

165% Debt to Income ratio? Ouch!! The bulk of that has to be in RE…then cars…then credit cards….student loans…crazy spending? Hey, we ALL did most of that at one time

This might be the “Last Chance” exit before…the SHTF.
How many will listen to those that have gone before? Few

#109 Dogs playing poker on 02.10.14 at 2:16 am

Stop worrying about HAM.

The Americans are now courting HAM with changes in their investor class of immigrants.

HAM can now buy and secure their bolthole in the United States of America by opening a business and employing 2 Americans for 4 years.

California, here they come.

Richmond will eventually go back to being Ditchmond.

#110 Happy Renting on 02.10.14 at 2:41 am

More peanut butter for Bandit, please. He’s got his priorities in order. For him, HAM is a good thing, especially if accompanied by cheese and in omelette or sandwich form.

#111 Andrew Woburn on 02.10.14 at 2:42 am

Mutual funds are as Canadian as hockey, doughnuts and snow. The big question is why

http://business.financialpost.com/2014/02/06/mutual-funds-are-as-canadian-as-hockey-housing-and-snow-the-big-question-is-why/

#112 Shot Ski on 02.10.14 at 3:05 am

20% of Canadian adults going bankrupt, even over a period of years, will cause ripple effects throughout the Canadian economy. Does this change your opinion of investments in Canadian banks*? And how ugly does it get for CHMC(aka the Gov of Canada)?
*Yes I know that you prefer preferred shares

#113 jane 24 on 02.10.14 at 4:09 am

My friend lives on a road of McMansions in Aurora. There are few HAMish investors there , mostly young families. This road is about 10 years old.

Two things that I have noticed is that the houses are not ageing well and no-one has the cash to do them up. Inside of 10 years they are looking tatty. Second that inside those houses the owners have little furniture or anything really that makes one comfortable. All the money goes on paying for the house.

What kind of life is living so far out, commuting in, sitting on white plastic patio furniture inside one’s own home and watching every cent.

Life must be for living.

#114 CB on 02.10.14 at 4:12 am

They don’t call it Hongcover Chinada for nothing.

I have lots of Chinese friends at University, and none of them stayed in Canada after they get their university paid for.

Their family come over, some with very questionable money, get their residency (not citizenship,) buy a house, buy their kids luxury cars, then they get their cheap taxpayers sponsored university education/health care and leave town. The taxes they generated for these one time purchase are much smaller than what they took from the system.

And not to mention some of them just come back to Vancouver few years later just to have kids so they can get their automatic citizenship. The entire family move back to China afterwards.

The funny thing is that all of them openly admit what I said is true. We Canadian are just too PC waving the racist card when it comes to anything immigration, what a shame.

BTW, don’t get me started with all the Korean pregnancy tour in Vancouver, where they come here to get their babies free citizenship. Is our government really that out of touch with reality?

#115 Vermithrax on 02.10.14 at 4:50 am

As Doug Stanhope says, “What do you care if your new next door neighbour’s an immigrant? The guy on the other side is white and you’ve never said so much as a ‘Hi,’ to him the whole time you’ve been there.”

#116 Mark on 02.10.14 at 5:11 am

Where’s the evidence for the existence of “HAM”? Seems to me that overall leverage in the housing market would be dropping if cold hard cash (the “M” in “HAM”) was actually being used to buy property in any significant fashion. But the fact is, leverage and debt is right off the charts. Maybe its not “HAM”, perhaps its “CCL”, or “Crazy Canuck Leverage” that’s responsible.

As it stands, the housing market in most of Canada has been in decline since the 1st half of 2013. Only by playing with the statistics and other number games have the RE boards been able to claim otherwise. The jig is up, the Realtors have lots of time to troll on message boards. Only suckers and random fools think otherwise.

#117 Mark on 02.10.14 at 5:13 am

“Number of super rich Chinese people that I know with houses in Canada: 0
Number of 25-30 somethings I know maxed out on mortgages in Canada: More than half
Ask yourself the same question (answer honestly) and stop blaming the boogey man.”

BINGO!!! Someone buy this man a stiff drink, he deserves it!

#118 Smoking Man on 02.10.14 at 7:01 am

http://www.theonion.com/articles/search-for-self-called-off-after-38-years,1794/?ref=auto

Ha, in search of self called off.

#119 Paul on 02.10.14 at 8:24 am

#102 We are renters and do not need to worry about the driveway, the roof or the furnace.

We we freemen (and woman).

Why worry about a furnace or roof they last

#120 Paul on 02.10.14 at 8:25 am

20 t0 30 years

#121 TurnerNation on 02.10.14 at 8:56 am

Ain’t too proud to beg. RIP middle class?
Bay is opening a Saks 5th Ave, and a coming Nordstrom. Richer than we think?

“The Globe and Mail reports in its Monday edition that for most of the 20th century, it seemed Canadians of all social strata shopped among Eaton’s, Simpsons and the Hudson’s Bay Co. The Globe’s Konrad Yakabuski writes that toward the end of the last century Canadians became segregated shoppers. The middle-class went to Sears Canada, the working-class to Wal-Mart and the rich to Holt Renfrew.

Sears, meanwhile, is hurting. It has closed most of its downtown locations. Dollarama’s surging shares have made it the hottest retail stock in Canada. It may be no coincidence that the highest-profile Canadian investments made by Bain Capital include Dollarama and Canada Goose. It is tempting to see the decline of mid-level stores like Sears, combined with the boom times at the top and bottom of the retail spectrum, as a sign of the much-heralded disappearance of the middle class. Canadians are wearing Canada Goose coats to Dollarama. The trouble is that we are still living beyond our means.
© 2014 Canjex Publishing Ltd.

#122 TurnerNation on 02.10.14 at 9:24 am

Actually I’m thinking Rob Ford’s surging popularity is based upon a wishful resurgence of
‘white male privilege’ . As has been reported he’s not a poor champion of the working classes (but springs from a wealthy industrialist family). His anything-goes frat boy antics belie this fact.
Perhaps a paid distractor for H? Every king needs a jester.

#123 Lester Hae on 02.10.14 at 9:31 am

Given how apparent the inflationary effects of HAM have been on property in Vancouver (as well as Sydney/Melbourne/Auckland, and to a lesser extent in Toronto)…

http://www.youtube.com/watch?v=Z92QTMeX4sU

… I have to assume you have a fair number of Asian clients that you want to keep sweet.

Your ‘proof’ is a 3-year-old TV clip featuring a developer and a realtor. Unbelievable. Van prices are crazy because locals buy crap like this. — Garth

#124 DJG on 02.10.14 at 9:40 am

Please provide a source for the 20% bankruptcy figure. It does not sound credible. There were 71,000 consumer bankruptcies in Canada in 2012 (a drop of about 10% from 2011). Please don’t tell me you got to 20% by multiplying 70,000 by 60 years? The basic premise of your argument, that people should spread risk over a balanced portfolio and not take on too much debt to buy real estate is obviously sound, but you undermine the argument daily by using dubious anecdotes instead of relying on data.

Bankruptcies and proposals last year were twice that number. — Garth

#125 S1 CLASS DUPLEX DRIVE on 02.10.14 at 9:55 am

Hey Garth –

Checking in from Yonge & Eglinton where the tower cranes are multiplying like rabbits. That hideous eCondo is going up for real on the NE corner of Y&E – the stores being razed are all now closed – and nowadays I can count six projects – SIX! – during my five minute walk from my rental to the tube.

Questions: If the condo market is set to explode, why are all these towers going up? I know about the five year lead time on these projects but still, I’m starting to think that people really do want a place to live in the urban centre, and they don’t want to rent. Perhaps there has been a shift in attitudes that makes condo living attractive to a whole new generation. Also, the non-mortgage debt numbers out this AM from Equifax seem to indicate that, while personal debt is high (~26K per working Canadian) the delinquency rate is low and falling. Perhaps it isn’t so bad out there and last week’s employment numbers might appear to confirm that.

Thoughts?

#126 Toronto_CA on 02.10.14 at 10:07 am

Morning blogdogs,

Suprising no one, Canadians have again taken out more debt, both consumer and mortgage, with total debt including mortgages rising 9.1% in the last year.

If the economy is growing only 1.7% but our debt is rising 9.1% and already maxed out in historical terms relative to incomes, what happens when our debt starts shrinking?

http://www.huffingtonpost.ca/2014/02/10/canada-consumer-debt-2014_n_4758228.html

#127 James O'Hanley on 02.10.14 at 10:20 am

20% seems high when you look at average stats, which appear to be somewhat predictable.
http://www.ic.gc.ca/eic/site/bsf-osb.nsf/eng/br03151.html

#128 Tony on 02.10.14 at 10:21 am

Re: #9 tkid on 02.09.14 at 7:36 pm

Maybe he looks like the dog from Jonny Quest.

#129 DJG on 02.10.14 at 10:23 am

Sorry Garth, but you are deliberately misleading people here. Bankruptcies and insolvencies did not double from the previous year. The figure I quoted was for bankruptcies only, not the combined number. The report for November, 2013 (the most recent stats) includes the following wording: “For the 12-month period ending November 30, 2013, the total number of insolvencies decreased by 1.5 percent compared with the 12-month period ending November 30, 2012.” So again the number of bankruptcies fell on a year-over-year basis.

Bankruptcies and proposals run at over 120,000 families per year, with interest rates in the ditch. This does not bode well. But feel free to ignore the danger and consequences. Most do. — Garth

#130 Marquis de Sale on 02.10.14 at 10:35 am

World According to…….is Bill Tufts.

#131 Semantics on 02.10.14 at 11:02 am

Primitive. What a disgusting comment. This thread will soon be ended. — Garth

Cecil Rhodes and every British colonizer, including the ones who colonized Canada preferred words like savages.

#132 walltiger on 02.10.14 at 11:07 am

#114 CB
“And not to mention some of them just come back to Vancouver few years later just to have kids so they can get their automatic citizenship. The entire family move back to China afterwards.”

if the entire family goes back to China, how come they are using the “tax payer sponsored” university and healthcare. stop your made up stories.

#133 Daisy Mae on 02.10.14 at 11:11 am

Never fear, people!

CBC interview, Flaherty: “Canada’s place in the world is remarkable today. We’re viewed as a solid country fiscally. We know what we’re doing.”

#134 Ray Skunk on 02.10.14 at 11:22 am

#125

The towers are still going up because the developers will still make money. To get to this stage, I’m guessing they started selling about 18 months ago. Back then they were able to sign up enough victims and take enough deposits to reach critical mass of break-even and satisfy their financial backers it’s worth starting construction.

Sure things have gone somewhat south now, they may have some unsold units on their hands and not make as much as they had hoped when all is said and done, but they’ll still end up in the black, just about. With a grim outlook, they’ll be happy to wrap up anything that makes even a hint of profit.

#135 Nemesis on 02.10.14 at 11:24 am

MondayMorning QuantitativeMischief…

…”The Post’s estimates are conservative, since they do not include Chinese who enter via a separate investor immigrant programme run by Quebec, 90 per cent of whose arrivals eventually end up living elsewhere in Canada.

Ottawa has pledged to process the backlog of federal applications. Under the scheme’s current rules, principal applicants worth a minimum of C$1.6 million must loan the Canadian government C$800,000, interest-free, for five years. They and family members can later apply for citizenship.

The overall queue for federal investor visas included 57,308 applications lodged in Hong Kong and Beijing, according to an Immigration Department spreadsheet obtained by the Post, dated January 8, 2013. That is more than 75 per cent of the whole queue, and separate provincial arrival data indicates about 99 per cent of the applicants are mainland Chinese.

Since 2007, 80.8 per cent of Chinese applicants to the scheme have sought to live in British Columbia, the Post’s data shows. If that holds true for the backlog of applicants, some 45,800 rich mainland Chinese would be bound for the province, representing 61 per cent of all applicants.

The trend appears to be growing. Chinese immigrants planning to settle in British Columbia made up 65 per cent of all applications to the popular wealth migration scheme in 2011.

The Post’s documentation was provided by Vancouver immigration lawyer Richard Kurland, who obtained it via freedom-of-information requests, costly data searches and scouring of obscure data.”…

[SCMP] – Exclusive: Vancouver facing an influx of 45,000 more rich Chinese: Over 60pc seeking Canadian wealthy investor visa are from China and want to live in British Columbia’s main city, data shows

http://www.scmp.com/news/world/article/1423370/exclusive-vancouver-facing-influx-45000-more-rich-chinese

#136 Smoking Man on 02.10.14 at 11:26 am

To all you idiots blowing crazy loot for an obedience certificate, below link is the future of higher education.

Why is it that only a crazed mad men are the only ones that can see the future better than anyone.

http://en.m.wikipedia.org/wiki/MIT_OpenCourseWare

#137 :):(Ying Yang on 02.10.14 at 11:31 am

#114 CB on 02.10.14 at 4:12 am
They don’t call it Hongcover Chinada for nothing.
I have lots of Chinese friends at University, and none of them stayed in Canada after they get their university paid for.
Their family come over, some with very questionable money, get their residency (not citizenship,) buy a house, buy their kids luxury cars, then they get their cheap taxpayers sponsored university education/health care and leave town. The taxes they generated for these one time purchase are much smaller than what they took from the system.
And not to mention some of them just come back to Vancouver few years later just to have kids so they can get their automatic citizenship. The entire family move back to China afterwards.
The funny thing is that all of them openly admit what I said is true. We Canadian are just too PC waving the racist card when it comes to anything immigration, what a shame.
BTW, don’t get me started with all the Korean pregnancy tour in Vancouver, where they come here to get their babies free citizenship. Is our government really that out of touch with reality?

_____________________________________________

I can say that you are telling a 99% truth about HAM family’s. My family came from Hong Kong and moved to Canada. I was born here while my older brother was born in Hong Kong. My parents still live here and will never go back over there. They experienced the Chairman Mao Zedong days in China and believe that under all of that we are not the same guys attitude of the current administration, the will turn on you like a dog when hungry! The newbys are stupid and believe that they can make money and come over here to create a safe investment haven in RE. If the government over there decides to collect on investments then they are all screwed. The Chinese government will get the investment money either by force or just enacting an edict. It is true though we know of so many family’s that have property here and never actually live here or contribute to the country in any way. Perhaps we are the 1% that have left our old land behind to make a new life here. My parents are disgusted by all of the people coming over here that take advantage of the soft system. When they came here it was tough to gain entry. My parents are often ashamed of the people who come here just to get the Canadian passport and then leave and return back to their country. They say that we (Canada) are being used by these people who dishonor the country to which we all belong. Canadian by birth and by choice!

#138 RVP on 02.10.14 at 11:43 am

@Poorgeoisie @ 83:

I have been trying to resist the urge to comment but the number of HAM denials on this thread is excruciating for this Vancouver person to bear. Poorgeoisie said:

“Number of super rich Chinese people that I know with houses in Canada: 0
Number of 25-30 somethings I know maxed out on mortgages in Canada: More than half
Ask yourself the same question (answer honestly) and stop blaming the boogey man.|”

That’s just it. For a lot of people, HAM is not some invisible boogey man. We don’t have any statistical data on HAM in Canada so all we’ve got is anecdotes that come from people’s personal lives–which means people have some personal real experience with HAM. To answer your question honestly–the vast majority of expensive houses in Vancouver I know of in Vancouver are owned by “super rich Chinese” (your term). I actually don’t know any 20- or 30-somethings with maxed out mortgages (not to say they don’t exist). All of my friends are 20- or 30-somethings and we all rent.

I want to say that I read this blog because I find it informative and entertaining. But I read it **despite** the HAM denials–which for me is a basic part of reality of life living in Vancouver. I also want to say that there are many different ways to talk about HAM–one can approach the topic intelligently and respectfully or one can approach the topic full of racist ignorance. I prefer the former–intelligent discourse over what many believe is a problem of excessive foreign investment in real estate. But when all discussion of HAM is shut down and labelled as racist all that ends up happening is the intelligent and thoughtful people who have something to say about HAM end up not talking and the more belligerent and racist people become even more determined to talk. I think refusal to acknowledge HAM as one of the factors in Vancouver’s real estate bubble is actually fanning the flames of racism, not dampening it. I would also like to say that all races of people who live in Vancouver are being negatively affected by HAM. There have been Chinese people living in what is now Vancouver since the 1800s. There are Chinese local people who have roots here going back generations. Not all Chinese people in Vancouver can be labelled as HAM. When HAM investors inflate up the cost of housing to exorbitant levels that has a negative effect on lots of local people in Vancouver–including Chinese people who have had families living in Vancouver going back generations. HAM is hurting local Chinese people who have lived here for decades, among other groups.

#139 James on 02.10.14 at 11:51 am

I have been saying that all along. There is absolutely no risk in buying SFH in the 416.

No correction. Nada.

Of course there will be a correction. But it will not be equal in its impact. — Garth

#140 Eaglebay on 02.10.14 at 11:51 am

#60 Oceanside on 02.09.14 at 10:05 pm
“My friends in business write off everything and have good lives without paying hardly any taxes.”

They can only write off legitimate business expenses. If they hardly pay any taxes it’s because they hardly make any money.
I call BS.

#141 tkid on 02.10.14 at 11:53 am

#125 – what I heard was there were massive fees/fines from city hall if the developers pulled out once things got started, but I fully admit I could be entirely wrong.

#142 High Plains Drifter on 02.10.14 at 11:58 am

We see H.A.M. and scrambled eggs on the main arterial from down town to the glorious west end of Edmonton. Edmonton loves its con men and an ultra expensive, abandoned condo project proves it. dark money Some say funding is um, not easily understood by the layman. Still if I get my way the blind shall be brought to see.

#143 :):(Ying Yang on 02.10.14 at 12:00 pm

#136 Smoking Man on 02.10.14 at 11:26 am
To all you idiots blowing crazy loot for an obedience certificate, below link is the future of higher education.
Why is it that only a crazed mad men are the only ones that can see the future better than anyone.

_____________________________________________

Wow Smoking Man do you hate the post-secondary system? Perhaps it just didn’t work for you man. It worked for my brother, myself, many of my friends and acquaintances. I don’t believe I am an Idiot? We have great positions that we would not have achieved without our university education. My so-called obedience certificate allowed me to get a position where I was in charge of a medium sized company. After spending two years there I decided to go out on my own. Without the knowledge I gained at university I could not have done as well. I recognize your declaration that everything is out there posted on the web, on the other hand if you don’t have the capability absorbing that free information then you may require support in integrating it into your knowledge base. Thus the Profs or TA’s can help to create an environment conducive to the targeted student so they can assimilate the so-called free web based information into their gray matter. Another great help is the group environment of others seeing a higher education and that we could all help each other. I will agree however that quite a high amount of students go into a course without investigating the ramifications of what position can I achieve once I have graduated with this so called obedience certificate! In other words if we have too many lawyers, teachers or whatever then why go into a environment where the job prospects are going to be severely reduced.
Any way keep on doing your thing, how is the book coming?

#144 maxx on 02.10.14 at 12:06 pm

#13 KommyKim on 02.09.14 at 7:59 pm

“A Realtor that I know just did consumer proposal.
It’s amazing. She only had to pay back 35% of what was owed (Apx 120K) and no interest is paid while that happens. She got to keep her 700K house, BMW, etc….
It’s no wonder why people take that route.”

Does that mean that the fiscal penitent (ha!) exclaims, “I propose NOT to pay!!” and then gets tea and sympathy? I guess the bankruptcy consultants believe that life will simply return to normal for her. Unfortunately, angry red dots don’t generally support it. CP-II, anyone?

Sounds as much of a joke as the taxpayer-funded yellow brick road that led us to this economic mess…Great Recession indeed.

The nation’s wealth is evaporating in all of the wrong places.

#145 Penny Henny on 02.10.14 at 12:06 pm

Canadian consumer debt reached a record $1.4-trillion in the fourth quarter, but delinquency levels also dropped to record levels, according to Equifax Canada.

http://business.financialpost.com/2014/02/10/consumer-debt-hits-record-1-4-trillion-but-canadians-getting-better-at-paying-it-back/

#146 gladiator on 02.10.14 at 12:07 pm

@137 YingYang:
why be disgusted at people taking advantage of a system for their own benefit? It is no secret that the Canadian passport is a great thing to have in your pocket when traveling, as well as to return to Canada – a safe haven for good family life and for investments. I have read an article a couple of years ago where it said that about 30% of immigrants return to their countries after getting the Canadian citizenship. If the Canadian system allows this to be done, someone will take advantage of it, for sure. The onus is on our authorities to stop this and prevent from happening again via laws, regulations, whatever.
We all financed the evacuation of “Canadian citizens” out of Lebanon in 2006 when violence broke up there. Guess what they did when things went back to normal? They went back, and shall something bad happen there again, they will be expecting the Canadian government to get them out of Lebanon again – and rightly so – because they are citizens of Canada. Boy did I fume when I read those news!
Same thing on unemployment. Why don’t our authorities push the unemployed to get a job, call them to their offices once a month to get proof that the unemployment benefits receiver actually did something to find a job in the past month and if insufficient proof is provided – suspend the payments until ample proof is provided again. So many of these moochers work for cash and skim the system into which we all pay through exorbitant taxes.
The system is broken and needs urgent mending.

#147 Aggregator on 02.10.14 at 12:08 pm

Moody's: "[Canadian] consumer debt certainly raises eye brows. It's a number that seems to defy gravity."

Indeed. Defy gravity by bailing out indebted consumers with workout deals, mortgage vacations, consumer proposals (chart by # of proposals) and debt consolidations (personal loan plans in millions) so the Big Five and CMHC don't have to report missed payments as delinquent.

Paging OSFI the barkless watchdog…beep, beep, beep. Time stop looking the other way and start barking for once, like doing onsite inspections to assess internal controls and instructing banks to write down those bad loans instead of reporting profit every quarter (chart).

With all truth aside, don't expect any change, because if it's one thing we learned, Canada's shitty deals stack even higher then American.

#148 Nemesis on 02.10.14 at 12:20 pm

More MondayMorningMischief… [or why RobFord, HogTown’s most notorious JayWalker, was recently seen frolicking in Vancouver?]…

[UK Independent] – Canada installs first ever crack-pipe vending machines

http://www.independent.co.uk/news/world/americas/canada-installs-first-ever-crackpipe-vending-machines-9118689.html

#149 valleyrenter on 02.10.14 at 12:23 pm

Reminds me of the HAMecdotes of the 80’s about homes being snapped up in the British Properties and people living without furniture. Then the 90’s flatlined realestate. Pouring all your money into a house and not having enough to live a nice life, or even having enough for repairs and maintenance. Methinks the carryover from all that housing excess is why you can still buy a dump in need of major repairs/renos in WestVan. Wash, rinse, repeat?

#150 rosie "moving forward" in the knowledge that, "this won't end well" on 02.10.14 at 12:27 pm

Will they continue to prop up a “bubble” or try to catch a falling knife?

http://www.marketwatch.com/story/rich-chinese-line-up-to-leave-china-2014-02-09?dist=lcountdown

#151 FormerSaskie on 02.10.14 at 12:34 pm

#98 flatlander
Remember the Penhorwood complex in Fort Mac.

If you choose to buy now make sure you have trades people inspect all of the building not only the unit you are interested in purchasing. If you are refused access to the mechanical areas to do an inspection I sugest you look else where.

Why not stay liquid and rent?

#152 Blase on 02.10.14 at 12:35 pm

Liberalism: belief in ideas.

Conservatism: belief in evidence.

Harper politics: eliminate all statistical evidence, then perpetuate idealistic thinking that has little to no basis in reality.

Canada is so beyond being able to walk this train wreck back.

#153 MrHulot on 02.10.14 at 12:36 pm

#135 Thanks Nemesis

From the South China Morning Post Feb 11, 2014

Kerry Starchuk is a lifelong resident of the Vancouver satellite city of Richmond, the most Chinese city in the western hemisphere and a favoured destination of wealthy mainland Chinese. She fears the potential impact of the visa queue.

“Money is taking precedence over everything,” said Starchuk, 56, who has campaigned for increased English signage in Richmond. “It’s taking over the social fabric, Canadian culture … You can see [the wealth disparity] in the houses that are being built – it’s no longer a single-family home, it’s a mansion with gates and security.”

The Post’s estimates are conservative, since they do not include Chinese who enter via a separate investor immigrant programme run by Quebec, 90 per cent of whose arrivals eventually end up living elsewhere in Canada.

There it is. Canada, a country where you can BUY citizenship and use it as a DOORMAT for the right price.

Hey Garth, still think we’re all racists?

I think if these were people from Oregon, not Guangdong, you’d be cool with them. — Garth

#154 crowdedelevatorfartz on 02.10.14 at 12:42 pm

@#71
Your comment…….
“….is a UNION member and proud teacher, they work their asses off for peanuts — together we have been members of 3 unions. We need to strengthen Labour again, not defund it. Strengthen the public sector, not kill it as those masquerading as libertarians but are actually corporate shills would like. People need to read history and understand it…..”
*******************************************
While I don’t have a problem with unions or their workers.
I DO have a problem with underfunded union pension plans. Of which the vast majority of gov’t employee pension plans are grossly underfunded. The pension plans are bankrupting cities(Detroit for example), states(California for example) and countries(Greece for example).
Taxpayers are expected to “make up the difference”. The same taxpayers(aprox 70% of the population and climbing) that have little or no pension to rely upon.
To expect these unpensioned taxpayers to quietly accept an increase in taxes to guarantee(a guaranteed pension!?!!??? Bwahahahahahahaha!) a unionized, retired gov’t workers pension is the ultimate in hubris.
And as for blithely commenting that “people need to read history and understand it…..” shows your true ignorance of this issue.
NEVER, in the working history of mankind, has a cohort of retirees(we’ll call them “boomers”) of this size left the working force. Union membership in the 1950’s was 70% private sector 30% public sector. Now its the exact opposite. Public sector employees used to be paid a less than average wage, now they are well paid. History is being rewritten.
Taxpayers, unpensioned retirees have had enough. Get ready for gov’t employee pension cuts, clawbacks, or closures or bankruptcies.
Don’t believe me?
Ask a soon to be unemployed Canada Post letter carrier….. :)

#155 Smoking Man on 02.10.14 at 12:54 pm

Ying Yang. Just a little ahead of my time as per usual… Read a bit of this, before posting the merits of the value of an obsolete system.

Book is going kind of slow, few challenges.

Almost a complete illiterate here. Two much time at Seneca getting hammered, and scaring the crap out of Garth with over the top insanity.
The challenge of inbeding my ideas of, life economy, making money into fiction. That way the message gets out, without the machine coming down hard and discrediting me.

Through fiction, I can get way with anything…

http://www.amazon.com/gp/product/B00EZCR9S0/ref=as_li_qf_sp_asin_tl?ie=UTF8&camp=1789&creative=9325&creativeASIN=B00EZCR9S0&linkCode=as2&tag=charleshughsm-20

#156 crowdedelevatorfartz on 02.10.14 at 1:01 pm

Totally off subject…….
Anyone care about the winter Owe limp icks?
Jingoistic flag waving for such brutally physical winter “sports” such as curling have me panting in animation of Canada’s chances at a “medal”.
My only fervent wish is that 2 Russian male hockey players start kissing on the gold medal podium causing Vladimir Putin to have a televised stroke…………

#157 :):(Ying Yang on 02.10.14 at 1:20 pm

#146 gladiator on 02.10.14 at 12:07 pm

Agreed, too many people take advantage of the sloppy system here that allows such a travesty to occur. My parents are very honorable people and they told me when I was young that I was blessed to be born here and that I should respect our country with great reverence. They have both voted in every single election since their citizenship and are very proud to part of Canada. They are also incensed about what my father calls “Users” (Lebanon for example) getting citizenship and using it to their own convenience.

#158 Victor V on 02.10.14 at 1:20 pm

http://www.theglobeandmail.com/globe-investor/personal-finance/household-finances/consumer-debt-swells-to-14-trillion-but-canadians-able-to-pay-it-equifax/article16772675/

The love affair Canadians have with debt is still going strong, according to a new report by credit monitoring agency Equifax Canada.

Equifax said Monday that its figures show that consumer debt, excluding mortgages, rose to $518.3-billion through the end of November 2013. That was up 4.2 per cent from $497.4-billion a year earlier.

Despite the increase in debt, however, the overall delinquency rate — bills due past 90 days — declined to a record low of 1.12 per cent from 1.19 per cent in the same period of 2012.

“The real pattern that we’ve been observing is that Canadians are taking on more debt, but they can handle it well and are making those monthly payments,” said Regina Malina, director of analytics for Equifax.

Meanwhile, overall consumer debt, including mortgages, also continues to rise — up 9.1 per cent to $1.422-trillion from $1.303-trillion a year earlier.

#159 MrHulot on 02.10.14 at 1:22 pm

#153

You don’t know me so how would you know?

I wouldn’t care who they are. I would be against any group who’s only criteria for citizenship is how much money they have. It’s unfair and negatively impacts the country in the long run.

#160 James on 02.10.14 at 1:24 pm

Of course there will be a correction. But it will not be equal in its impact. — Garth

By that you mean maybe 10%? Sure. Still not 2009 level. In the grand scheme of things over 30yrs…negligible.

#161 Big Brother on 02.10.14 at 1:24 pm

MKULTRA says this almost win was for Smoking Man. Ashley Wagner danced to Pink Floyds Shine on you crazy diamond in Soshi. An almost win then Bullshit. Next Olympics we are re-programming you for Skating so lay off the booze.

http://www.theglobeandmail.com/life/celebrity-news/the-a-list/congratulations-ashley-wagner-us-figure-skaters-reaction-to-her-own-score-becomes-online-sensation/article16774055/

#162 kitchener on 02.10.14 at 1:31 pm

Garth, please take a look at the articles by South China Morning Post and Marketwatch.

I am NOT a HAM-hater by any means and generally think immigration is good. However, a massive influx of wealthy foreigners does make it more difficult for Canadians to buy homes for themselves. Should the Canadian government not be coming up with some ideas to welcome immigrants but at the same time protect locals’ ability to buy homes for themselves? Is that so socialist?

For example, in Malaysia as part of their MM2H visa program, the minimum you must spend on a property (if you want to buy one, its not required) is MYR 1 million (just increased from half that). And in Thailand, foreigners may buy apartments but not land.

So why can’t Canada come up with something that encourages immigrants to move here if they want to, but not to destroy our housing market for young people in the process? Serious question.

#163 Ralph Cramdown on 02.10.14 at 1:35 pm

When you do the math on that Equifax report, it looks like mortgage debt increased 12.2% in the 12 months to November. Canada’s population growth is about 1.1%/year and the Teranet HPI shows a 3.8% YoY increase.

Now you know how it is that people aren’t delinquent on their credit cards.

#164 Infused with Opiates on 02.10.14 at 1:39 pm

140 Eaglebay – it is a common misconception by those who get a regular paycheck – esp govt workers and
those who have never had to write anyone a bill.

The one thing I will say though is that by the time my accountant gets through with it, things like cell
phones, computers, email, and many vehicle expenses
have been written off so I always consider that when I
look at the bottom line. The vehicle itself is worth $1000s every year.

#165 kitchener on 02.10.14 at 1:47 pm

Just following on from my last post, I would suggest Canada let foreigners move here but tell them they must rent until they are full citizens. So, home sales for citizens only. That would slash the number of applicants buying just to park cash. Most non-HAM rent when they arrive, so this component of immigration would be unchanged. All rich foreigners just looking to park cash and not necessarily even live in the place (an epidemic in London UK) would be forced to look elsewhere. Tell everyone if you want to buy here, become a citizen. Why would this not work?

#166 Nemesis on 02.10.14 at 1:51 pm

“I think if these were people from Oregon, not Guangdong, you’d be cool with them.” — HonGarth

Hmmm… speaking of GuangDong – this morning’s final MischiefMaking… [and MalapropismOfTheDay!]…

“[This problem] must be strictly handled!” – Hu Chunhua, Guangdong CCP Secretary

[SCMP] – Police crackdown on Chinese ‘sex capital’ Dongguan prompts surprising outpouring of sympathy

http://www.scmp.com/news/china-insider/article/1425251/police-crackdown-sex-capital-dongguan-prompts-surprising-outbreak

[NoteToGT: Just between the two of us, I’d have penned a different leader: “DongLongGuan?: GuangDong Party Secretary’s Outrage Prompts DongGuanJohn Exodus” or, alternatively, “Dongguan Police Hail Party Secretary’s Strict Handling Edict: Entertainment Venues Accommodate 6,500 Officers in Single Evening”.]

#167 bill on 02.10.14 at 2:00 pm

you touched a nerve with the xenophobes….
ham to blame? not so much.
IDIOTS who believe realtors [!] telling them ‘the Chinese’ are buying up everything and taking away our country [weep …wail] buy! or you will never get any…hurry before its to late- buy buy buy!

that sounds much more likely.

#168 Son of Ponzi on 02.10.14 at 2:11 pm

If these people were from Orgegon rather than Guangdong, you’d be cool with it. -Garth.
—————————-
Garth, I think it’s a little more complicated than that.

#169 Casual Observer on 02.10.14 at 2:11 pm

Here’s a link to an excerpt I posted a few years ago, which draws a neat analogy to how many people are feeling about having local RE prices bid up by those who are perceived to have not contributed to society and who didn’t “play by the rules” (rich foreigners, drug dealers, irresponsible borrowers, etc.)

It talks about how a large increase in purchasing power chasing limited assets – whether it be foreign investors, drug money, a massive credit expansion, or “Mrs. Hill dollars” can cause distortions in the market pricing mechanism, alter society’s reward system, and cause resentment in people who “did all the right things”, yet found their piece of the pie was un-attainable because it was bid up by someone who came along with deeper pockets.

The moral of the story seems to be that hard work, thrift, and patience can be trumped by greed, irresponsibility and profligacy if authorities lose control of the reward system that encourages responsible behavior.

http://housing-analysis.blogspot.com/2007/07/inflation-different-schools-of-thought.html?showComment=1184708100000#c7242790193871023503

It’s point #2 under the first comment left by “freako” (remember him?)

#170 My Name on 02.10.14 at 2:24 pm

Hey

#38 World According To Garth on 02.09.14 at 9:13 pm

What do you do for a living? You seem very angry.

#171 walltiger on 02.10.14 at 2:25 pm

YINGYANG:
your example of your family is a limited representation of all the immigrants from Asia. Only 5% of all mainland Chinese immigrants fit into the investor class, which means 95% of them will most likely stayed in Canada after entry. of the 5% who are “super rich Chinese” most of the bread winner went back to China, thats true, but their wife and kids stayed here to go to school and adapting life. kids who grow up here will not likely to go back to China and eventually dad will retire and settle here for good too. thats the whole point of getting a Canadian passport, to eventually live in this country and not because they wanted to game our “generous system”, it is a pittance of what we offer compared to their wealth. As for these mainland immigrants, yes, some of them are not cultured or conduct themselves with class because the way and the type of environment they were brought up and lived in, so don’t associate with them. things will change when they are here long enough and learned our way of business. their kids will turn out to be like you, a second generation Chinese Canadian, and most of them will turn out to be upright and successful. so chill.

#172 Buy? Curious? on 02.10.14 at 2:26 pm

Hey Garth! When you see articles like this in the National Newspaper, do you cry?

http://www.theglobeandmail.com/report-on-business/top-business-stories/surging-toronto-home-prices-pose-big-economic-risk-in-2-3-years-bmo/article16776671/

#173 A Yank in BC on 02.10.14 at 2:33 pm

Garth.. love your blog.. and agree with you on most everything. But at the risk of invoking the “R” word, may I say that I think you have consistently underestimated the effects of wealthy Asian immigration on the lower mainland’s property market, and how it will only continue to do so.
From marketwatch.com’s This Week in China.

“Wealthy Chinese mainlanders are voting with their feet in eye-popping numbers and preparing to emigrate — taking both their money and family with them.

First it was reported that mainlanders made up 91% of all applications for investment visas going to Australia since the scheme was launched in 2012. But this was small beer compared to Canada, as it was disclosed there was a backlog of 57,000 applications from China for investment-immigrant visas. The South China Morning Post reported 45,000 mainlanders were seeking to emigrate to British Columbia alone, with an estimated minimum combined wealth of not less than 90 billion Hong Kong dollars ($11.6 billion).”

http://www.marketwatch.com/story/rich-chinese-line-up-to-leave-china-2014-02-09

#174 VancouverGoinUp? on 02.10.14 at 2:40 pm

Wow. Incredible. Someone actually gets it. Someone actually not hiding from reality.The word HAM is offensive. Folks, Vancouver has continued to go up significantly since the late 90’s We have all made out like bandits. It’s called Offshore money from around the world. Garth consistently plays the race card because it doesn’t fit in with his theory on incomes,interest rates and debt. After the dot com collapse, 911, offshore money was looking for a safe haven. That haven was Vancouver. Garth’s basic message is dead on regarding a mixed portfolio and topping up your TFSA but his message on Vancouver has been dead wrong. Need proof? Talk to a renter (crowded elevator)the past 10 years in Vancouver compared to an owner. A new storm is brewing around the world in regards to foreign ownership. This is the achiiles heal of Vancouver. Garth will continue with his income debt theory but rest assure this is dead wrong. Only high taxation or new regulations regarding “foreign” money can stop this freight train. Make no mistake. New regulations regarding ownership and Vancouver is cooked
****************************************
#138 RVP on 02.10.14 at 11:43 am
@Poorgeoisie @ 83:

I have been trying to resist the urge to comment but the number of HAM denials on this thread is excruciating for this Vancouver person to bear. Poorgeoisie said:

“Number of super rich Chinese people that I know with houses in Canada: 0
Number of 25-30 somethings I know maxed out on mortgages in Canada: More than half
Ask yourself the same question (answer honestly) and stop blaming the boogey man.|”

That’s just it. For a lot of people, HAM is not some invisible boogey man. We don’t have any statistical data on HAM in Canada so all we’ve got is anecdotes that come from people’s personal lives–which means people have some personal real experience with HAM. To answer your question honestly–the vast majority of expensive houses in Vancouver I know of in Vancouver are owned by “super rich Chinese” (your term). I actually don’t know any 20- or 30-somethings with maxed out mortgages (not to say they don’t exist). All of my friends are 20- or 30-somethings and we all rent.

I want to say that I read this blog because I find it informative and entertaining. But I read it **despite** the HAM denials–which for me is a basic part of reality of life living in Vancouver. I also want to say that there are many different ways to talk about HAM–one can approach the topic intelligently and respectfully or one can approach the topic full of racist ignorance. I prefer the former–intelligent discourse over what many believe is a problem of excessive foreign investment in real estate. But when all discussion of HAM is shut down and labelled as racist all that ends up happening is the intelligent and thoughtful people who have something to say about HAM end up not talking and the more belligerent and racist people become even more determined to talk. I think refusal to acknowledge HAM as one of the factors in Vancouver’s real estate bubble is actually fanning the flames of racism, not dampening it. I would also like to say that all races of people who live in Vancouver are being negatively affected by HAM. There have been Chinese people living in what is now Vancouver since the 1800s. There are Chinese local people who have roots here going back generations. Not all Chinese people in Vancouver can be labelled as HAM. When HAM investors inflate up the cost of housing to exorbitant levels that has a negative effect on lots of local people in Vancouver–including Chinese people who have had families living in Vancouver going back generations. HAM is hurting local Chinese people who have lived here for decades, among other groups.

#175 I_AM_HAM on 02.10.14 at 2:40 pm

Garth, I fear that you mis-understand HAM and its workings.

Speaking of miss, I demand the IOC does a gender verification on Olga Graf, I fail to see what it was she was about to flash!

#176 walltiger on 02.10.14 at 2:51 pm

#173
Currently the program has a severe backlog, with a potential wait time of 12 years. As per a story in The Toronto Sun, Jim Versteegh, a federal immigration program manager at the Canadian consulate in Hong Kong, there are about 22,491 millionaire investors worldwide who’ve applied and are waiting to come to Canada.[5]

#177 Aggregator on 02.10.14 at 2:53 pm

#213 recharts on 02.09.14

The MLS view of the same market shows that the rents went down

In case you're wondering how close Craigslist and TREB's rent data correlate: chart

You'll notice rents tend to dip in Q1. That's because landlords, like home sellers, are waiting for active season to hike prices. Rent prices in major metros are set to soar as boomers downgrade and immigration increases (including those who already migrated to other provinces and decide to move to Toronto and Vancouver).

However, higher rent prices paid towards landlords' rising utility bills and debt service will consequently have a negative effect on retail spending. Hence all the recent job cuts and why Holts is launching an online luxury retail website as yuppie traffic volume declines.

Holt Renfrew CEO dishes on Luxury retailer’s first sales website

No matter what the government tries to boost effective demand, there will always be knock-on effects costing more jobs and less spending. The problems we face today cannot be easily fixed with more magic wand spending and  subsidies. These are structural problems as a result of ZIRP and more money printing.

#178 45north on 02.10.14 at 2:58 pm

Sign of the times BIL owns a Shoppers Drug Mart

thanks for your story

Tron What they pay for the property is much less important than getting as much of their money as possible out of China.

and once the outlook for property is seriously negative then what they get will be much less important than getting out

Mr. Monday Night Not many folks out there who learn their lesson

thanks for your insight

Retired Boomer – WI This might be the “Last Chance” exit before the shit hits the fan. How many will listen to those that have gone before? Few

very few indeed. through 2013 prices went up and people contemplating selling their houses expect the trend to continue.

Mark Seems to me that overall leverage in the housing market would be dropping if cold hard cash was actually being used to buy property in any significant fashion.

true but the effect could be a total crash. Someone who paid $800,000 cash for a house could sell it for $400,000 tomorrow. A dozen sales would set the comparables for the whole neighbourhood. Marc, you could be totally screwed.

Ray Skunk The towers are still going up because the developers will still make money. To get to this stage, I’m guessing they started selling about 18 months ago.

I was guessing too. Here’s a great article by David Fleming

http://www.torontorealtyblog.com/archives/condominium-financing/9775

Ying Yang They say that we (Canadians) are being used by these people who dishonor the country to which we all belong. Canadian by birth and by choice!

that got my attention

#179 Victor V on 02.10.14 at 3:02 pm

http://www.theglobeandmail.com/globe-investor/personal-finance/household-finances/tying-the-knot-four-in-10-canadian-marriages-begin-in-debt/article16773390/

As Valentine’s Day approaches, couples thinking of tying the knot might want to take note of the following: four in 10 Canadian marriages begin in debt.

The average new family starts off with an average of $21,503 in debt on its wedding day, according to a recent poll conducted for consumer proposal and trustee in bankruptcy Hoyes, Michalos & Associates Inc.

“It’s scary that before starting a new life together many Canadians are already burdened with debt,” said Douglas Hoyes, a bankruptcy trustee with Hoyes, Michalos.

“How can you buy a house, start a family and live the Canadian dream when you are already in debt?”

#180 Dupcheck on 02.10.14 at 3:06 pm

The HAM dude that bought that place, probably bought a citizenship through by buying that home “investing”. So that makes him an investor of over 500k or what the limit of getting a citizenship in Canada is. Probably hold it for 3 years until gets passports and wala Canadian citizen. Then sell the home to the next want to be Canadian HAM. Beautiful scheme isn’t it? This has to stop, it is messing our housing market and young generation up!!!

#181 Son of Ponzi on 02.10.14 at 3:08 pm

Wall tiger #171
stop living in the past.

#182 Stickler on 02.10.14 at 3:11 pm

@ #71 gtrz4peace on 02.09.14 at 10:33 pm

@#57 “NAKED APE”

” Hubby is a UNION member and proud teacher, they work their asses off for peanuts — ”

—————————-

…All the teachers I know are very well compensated. In my opinion, over compensated.

I know many private sector employees with more education, that work many more hours

…and receive much less pay, benefits, and job security.

Also they are responsible for 100% of their own retirement.

I agree unions are important, but your comment that teachers work their asses off for peanuts is pure fiction.

#183 Vamanos Pest on 02.10.14 at 3:14 pm

Garth,
“…20% of everybody will go bankrupt.”

That IS shocking. What’s the source for that prediction?

Yikes!

#184 gut check on 02.10.14 at 3:19 pm

I miss my dog. :(

#185 TorontoBull on 02.10.14 at 3:26 pm

@SM – I understand you are a pink floyd fan…may I recommend you listen to porcupine tree…I think you may like them

#186 walltiger on 02.10.14 at 3:26 pm

#181 son of ponzi

care to elaborate?

#187 Herf on 02.10.14 at 3:27 pm

Poem about a dog named Beau

#188 Deb on 02.10.14 at 3:27 pm

F will rise in the House on Tuesday afternoon to deliver the federal budget. It is the only time of the year that I allow myself to take a drink so early in the day.

#189 walltiger on 02.10.14 at 3:31 pm

#180 dupcheck

you are not a very bright person aren’t you.

#190 Ronaldo on 02.10.14 at 3:37 pm

#136 Smoking Man – I agree with you totally on this. Lots of articles online on this subject. The way of the future for sure. In fact, already happening. Speaking to the daughter of friends who is attending University in New York says that she often skips the lectures in favour of the online recorded version. And, getting top marks to boot. Big changes going to take place in our educational system.

#191 Cyclist on 02.10.14 at 3:55 pm

175 HAM – she can ride with me anytime.

#192 crowdedelevatorfartz on 02.10.14 at 3:57 pm

California’s $355,000,000,000.00(Billion!) debt pile( mostly in the form of underfunded pension payments and health benefits to retired public employees) has caused it to become the second worst state in America for fiscal mismanagement.
CalSTRS(California Teachers Pension Plan) is underfunded by $22,000,000.00(million) per DAY.
It is expected to run out of money by the year 2020 if nothing changes…….ie higher taxes……
Hopefully grtz4peace husband doesn’t have all his retirement money invested in the Ontario Teachers Pension plan. It’s currently dishing out more money than it takes in………….Sound familiar?
Keep an eye on California over the next few years to see what’s coming for ALL of us.

#193 Spectacle on 02.10.14 at 3:57 pm

Thanks Garth.

#79 Aggregator on 02.09.14 at 11:02 pm
Hey about those wealthy investors that were suppose to settle in Quebec but ended up fleeing to Toronto .

…………… Ahh, but not for Canadian RE,………properties can be sold for cash to anybody breathing…., including criminals and corrupt officials.

…….. It’s just government, banks and a lot of damn crooks with the same goal of transferring more wealth from your bank account to their pockets.

I can buy property in Spain. And they give me a residency card for doing it. Take the tin foil off, dude. — Garth

The so described HAM ( a very limiting term ! ) the new and 2nd generation, are hard working, are very desirous to escape 1) Government Corruption, & 2) corporate crime.

They are 10 plus year Canadian immigrants, and keen on building quality infrastructure and wealth for us fellow “Canadians.”. Dedicated citizens, despite how difficult it is for all of us to build a business in Canada.

For what it’s worth. I’m very happy working with business people with such dedication & integrity for a change. It’s called work.

#194 Long time Vancouverite on 02.10.14 at 4:10 pm

#138 – a very articulate post. I have lived in Van for 40+ years and have been afraid to post my experiences to the changes in the city for fear of being labelled a racist. Kudos to Garth in keeping your post. It shows the blog is not completely biased.

#195 Allan on 02.10.14 at 4:13 pm

A lot of delusional people here, YoY house prices appreciated by 7%. End of the story. Wait another year and pay more…

#196 :):(Ying Yang on 02.10.14 at 4:15 pm

YINGYANG:
your example of your family is a limited representation of all the immigrants from Asia. Only 5% of all mainland Chinese immigrants fit into the investor class, which means 95% of them will most likely stayed in Canada after entry. of the 5% who are “super rich Chinese” most of the bread winner went back to China, thats true…

——————————————————-

5% of 1,351,000,000 is 67,550,000 thats a lot of investor class knocking at our door. OK I’m cool, I’m chilled.

#197 Steven on 02.10.14 at 4:27 pm

DELETED

#198 :):(Ying Yang on 02.10.14 at 4:28 pm

#155 Smoking Man on 02.10.14 at 12:54 pm
Ying Yang. Just a little ahead of my time as per usual… Read a bit of this, before posting the merits of the value of an obsolete system.
Book is going kind of slow, few challenges.
Almost a complete illiterate here. Two much time at Seneca getting hammered, and scaring the crap out of Garth with over the top insanity.
The challenge of inbeding my ideas of, life economy, making money into fiction. That way the message gets out, without the machine coming down hard and discrediting me. Through fiction, I can get way with anything…

__________________________________________

Took girlfriend to Seneca last Friday night, big changes nice new bar. She likes it, could be very expensive for me. Lucky for me it is not open yet. Try not to pick her up at the bar, shes very, very high maintenance.

#199 Son of Ponzi on 02.10.14 at 4:34 pm

Wall tiger,
The Chinese immigrants of the past were different than the current and future ones.

#200 DR on 02.10.14 at 4:44 pm

Well, its happened again. This time a semi-detached in Roncesvalles, which needed work has sold…for 798,000. NOT AS bad as the detached one on Galley. But it still needed a renovation.
That makes the detached look like a steal for only $5000 more. What is going on.

#201 walltiger on 02.10.14 at 4:49 pm

196 YINGYANG,

last year the Mainland Chinese immigrants to Canada is about 65000, not 1.3 billion. Canada now limits the Investor Class to only 750 per year.

#199 Son of Ponzi,

i am talking about current and future Chinese immigrants.

#202 4 AM Sunrise on 02.10.14 at 5:09 pm

I think I know where all of this HAM haterade is coming from. As a Hot Asian myself (or at least the guy in the bar on Friday night sure thought I was), I’ll try to shed some light on this.

I notice that most people here do not personally know the ‘A’ that’s attached to the HAM. So of course you fear what you do not know.

And it’s not your fault.

I’ve met a couple of these HAM types. Bored housewives with a husband overseas, waiting for the kids to finish high school so that they can go back to the old country. One of them asked me, in a supermarket, if the oranges in front of her were Sunkist oranges. See, she couldn’t read the English name on the box. She sighs and say, “oh, I wish my English were better.” Why doesn’t she take advantage of the free English classes offered by multiple government-affiliated agencies? “Oh, I just don’t have the time.” Humans are lazy by nature. They won’t be compelled to learn English if they can comfortably live their day-to-day lives in their native language.

So if there’s a language barrier, and they’re not standing behind you in the coffee line-up at Tim Horton’s, or sitting beside you at the hockey rink watching the kids practice, you won’t get to know them or their story. Which is kind of too bad for everybody.

And there’s this phrase circulating in the immigrant community – “citizenship prison”. Example: “this city sucks, but I have 2 more years of citizenship prison to do before I can leave.” There, that oughta get some of you riled up. Just a reminder that not all immigrants have this attitude, but some do.

Plus there’s a kind of efficiency that governs social interactions. If they don’t feel that they stand to benefit (materially) from interacting with the locals, they won’t. I was at a ballroom dance class and this Asian guy asked me to dance. Cool. He asked me if I was Chinese. I said yes. He asked me if I was born in Canada. I said yes. And then he clammed up for the rest of the song. I don’t know how to interpret that kind of abruptness. I figure it’s because he figured I wasn’t wife material and therefore not worthy of further chitchat.

But I can see how this drive towards efficiency can cause alienation and it all builds up into some HAMtastic finger pointing when the debate comes up.

On the upside, the children do tend to stay. They appreciate their independence here and want to get away from those nagging parents who have gone home to the old country!

#203 4 AM Sunrise on 02.10.14 at 5:17 pm

#104 Bill Gable on 02.10.14 at 1:34 am

I hear that some of the 400 sq ft shoeboxes in the downtown sky are mistress condos. Cheating husbands from the suburbs justify them to their wives by saying oh, it’s a crash pad for when I have to work late. Thanks, AshleyMadison.com, for doing your part in goosing the condo market!

And on that note, a realtor acquaintance of mine just announced on LinkedIn that he is looking for full-time work in management, operations, etc.

#204 rosie "moving forward" in the knowledge that, "this won't end well" on 02.10.14 at 5:17 pm

#192 crowd….

A lot of posters spout unverified statistics on this blog on a daily basis. Some less frequently. These are the facts, if you care to read them.

http://www.otpp.com/documents/10179/686422/Investment+Summary+2012/d2b54009-f5ab-4ccf-8288-b0a25ddc6157

#205 garthothegranddenier on 02.10.14 at 5:27 pm

BANNED

#206 Smoking Man on 02.10.14 at 5:33 pm

#198 :):(Ying Yang on 02.10.14 at 4:28

Took girlfriend to Seneca last Friday night, big changes nice new bar. She likes it, could be very expensive for me. Lucky for me it is not open yet. Try not to pick her up at the bar, shes very, very high maintenance.
………..

No worries, happily married, plus if I was going to stary, short term rentals only… Lol

Speaking of hot Asian money.

I have noticed a hell of a lot more Niagara bound buses on QEW. With Chinese writing. Heading to casino.

They are fools. They go to fallsview..

#207 crowdedelevatorfartz on 02.10.14 at 5:44 pm

@#205
Perhaps you should read a bit further in the link that you provided…….
‘The Ontario Teachers’ Pension Plan was 97% funded on Jan. 1, 2013. That means the plan was projected to have 97% of the funds required to meet its long-term pension obligations. A preliminary funding valuation showed a $5.1 billion gap between projected assets and projected liabilities (the cost of future pensions) at the beginning of 2013. The shortfall is projected despite a 13.0% return on plan investments in 2012 and recent plan changes that eliminated a shortfall last year.

For more information, see Top Plan Funding Q&…..”

So basically your link backs up what I said.
Thank you.

As I correctly stated” the Ontario Teachers Pension Plans is currently handing out more money than it is taking in……….despite excellent returns on it’s investments…….its losing money….
Which in my basic math skills accounting ledger means……..eventually it will go broke.
But you just keep believing that taxpayers will bail you out and that everything will be “Rosie”. :)

#208 crowdedelevatorfartz on 02.10.14 at 5:49 pm

P.S.
Rosie please tell me that you weren’t a math teacher in another life………

#209 TEMPLE on 02.10.14 at 5:53 pm

Too much work as usual for my sporadic baloney patrol. Two standouts today, however.

#154 crowdedelevatorfartz on 02.10.14 at 12:42 pm

I DO have a problem with underfunded union pension plans. Of which the vast majority of gov’t employee pension plans are grossly underfunded.

Better check that statement (because you are wrong).

The pension plans are bankrupting cities(Detroit for example), states(California for example) and countries(Greece for example).

Well, notwithstanding that none of your examples are Canadian, you are confusing mismanagement with neocon ideology.

Public sector employees used to be paid a less than average wage, now they are well paid.

Wrong again. Dig into this a little, and try and balance out some of the right-wing echo-chamber garbage.

Ask a soon to be unemployed Canada Post letter carrier….. :)

Canada Post wasn’t cutting back because of pension obligations; your statement is just completely wrong. I encourage you to find out why Canada Post is struggling (hint: it has nothing to do with what the Neocons claim).

And now, this guy:

#182 Stickler on 02.10.14 at 3:11 pm

I agree unions are important, but your comment that teachers work their asses off for peanuts is pure fiction.

You only say that because you have no idea what you are talking about. If being a teacher is such a sweet deal, go be a teacher. Because if you don’t, it makes you look stupid for complaining that teaching is an easy gig.

TEMPLE

#210 Poorgeoisie on 02.10.14 at 5:55 pm

RVP, I understand that there are many wealthy people moving to VAN but I hear the same excuse in halifax, ottawa, Toronto and my current city Montreal. The nationality changes here and there but the basic premise is the same: I can’t afford a house because of foreigners bidding up the price. Prices have gone up from coast to coast thanks to low interest rates and relaxed lending standards.
We are in a bit of a jam because we need immigrants to fund our social programs and to infuriate “World According to Garth” aka western man. If the majority of people can’t afford (or meet the criteria) to buy the price will come down. Handfuls of rich people cannot generate the increases in price that we have seen on a national scale. Only policy and/or a legitimate lack of supply could cause these increases. It is easy to know we don’t have a supply problem because banks would loan to the highest bidder as they did in the 80’s (when I was in VAN go nucks) instead of scrounging and bending the rules for bottom feeders as they do now.

#211 garthothegranddenier on 02.10.14 at 5:56 pm

BANNED

#212 Hillbilly on 02.10.14 at 6:09 pm

I have been reading this blog for a while now.

I fail to understand that posters here really do not understand that;

1) insanely high house prices
2) outrageous personal indebtedness
3) rent to value ratios way outa whack
4) house prices to income metrics totally of the charts
5) rampant mortgage fraud (EMILY system easily gamed)
6) increasing unemployment and dearth of well paid new jobs
7) paltry down payments and lax lending (CMHC)

etc., etc., etc………

matters when you are in the grip of a mania?

None of the above (nor any other factors you can come up with) matters!

Until it does.

#213 Son of Ponzi on 02.10.14 at 6:24 pm

4 AM
“citizenship prison” very well known phrase used in Richmond.
“mistress condo”
Just like rich Hongkongers have in Shenzen.

#214 crowdedelevatorfartz on 02.10.14 at 6:28 pm

PPS.
…….and if you think the Ontario Teachers Pension Plan will have 13% “returns” year over year……..you’re more delusional than I suspect.

:)

#215 Shawn on 02.10.14 at 6:31 pm

A Little Knowledge is a dangeous thing

“Farts” at 208 said:

As I correctly stated” the Ontario Teachers Pension Plans is currently handing out more money than it is taking in……….despite excellent returns on it’s investments…….its losing money….
Which in my basic math skills accounting ledger means……..eventually it will go broke.

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

Read closer, the chart at page 1 shows its assets climbed by a large amount in the last year shown, 2012.

2013’s assets when they are posted are sure to show a huge increase versus 2012.

Assets are growing because intakes and growth are HIGHER than the amount paid out.

Rosie at 205 appears to be the better mathematician.

#216 rosie "moving forward" in the knowledge that, "this won't end well" on 02.10.14 at 6:36 pm

#209

I’ll start worrying in 70 years.

#217 Stickler on 02.10.14 at 7:04 pm

@ #210 TEMPLE on 02.10.14 at 5:53 pm

No where did I say teaching was easy, or not worthy of professional compensation.

What I said was “your comment that teachers work their asses off for peanuts is pure fiction.”

See what you did? Of course you do…

#218 TEMPLE on 02.10.14 at 7:30 pm

#218 Stickler on 02.10.14 at 7:04 pm

No where did I say teaching was easy, or not worthy of professional compensation.

What I said was “your comment that teachers work their asses off for peanuts is pure fiction.”

Right, you didn’t outright state teaching was easy, you just implied it. Your essential (and incorrect) meaning is that teachers are overpaid, i.e., they have it easy. You can quibble all you want over semantics and the definition of “easy”, but the fact is your whinging and jabbing at people who do valuable work for fair (at best) pay simply comes off as jealous and/or misinformed.

TEMPLE

#219 crowdedelevatorfartz on 02.10.14 at 7:45 pm

@Temple

‘neocons’

Riiiiiiiiiiiiiiiiiiiiiight.

Is there a full moon in your world tonight?

#220 crowdedelevatorfartz on 02.10.14 at 7:50 pm

@#217 Rosie
Well if you can joke about a Ontario Teachers Pension projected shortfall of $5.1 BILLION dollars

Laugh away.

Just don’t be surprised if Ontario’s taxpayers scream bloody murder when your pension find goes cap in hand begging for a bail out………..

#221 crowdedelevatorfartz on 02.10.14 at 8:08 pm

TEMPLE
FACT: Gov’t pensions are underfunded.
FACT: Teachers are very well paid.
FACT: When your arguments are unsupportable you blame everything on “neocons ideology” whatever THAT paranoid delusion is supposed to be.
FACT: Canada Post has an $800 million dollar deficit of which $300 is employee pension based.
FACT: Like most unionized gov’t employees you refuse to accept simple math. Union employee pension deductions do not have adequate funds for the future employees payments.

You know I’m right . Just admit you’re wrong. :)

#222 wallflower on 02.10.14 at 8:10 pm

#114 CB on 02.10.14 at 4:12 am
They don’t call it Hongcover Chinada for nothing.
=======
I am not Chinese and have no mainland friends, just Hong Kong friends. (My neighbours are mainland but I don’t speak their languages.) My Hong Kong friends say the exact same things as CB. They say that Canada is the only place in the world where this can all be achieved so efficiently and so cheaply. It really annoys my HK friends. I can only speculate that the difference is the HK people I know see the mainlanders as opportunitists, not citizens. (I recall a number of opportunist HKers who came then left.)
But here is something else interesting. I have several Canadian-born friends who have not lived in Canada for 25 years. Some live in Australia and others in Japan. Yet, their children are all attending Ontario universities at the resident rate because of their dual citizenship. (I also know a whole whack of Hong Kong and Portuguese nationals who fly here for health care using OHIP numbers yet are resident out of country 50 weeks per year.)
Canada has yet to learn the basic lesson of residency versus citizenship that every other developed nation gets. We need to apply residency screens to education, health care and property ownership. We apply it to OAS! So, the takeway from this is that the federal government has a handle on this but the provinces are flailing.
In Florida, Canadians pay almost double the property tax… other countries are smart. Canada is just dumb. (federal/provincial model; BNA Act)

Regarding HAM.
The impact of mainland China on this city in which I live is almost complete: shortly, those flying between mainland China and Chinamark (as I call it), will notice little difference other than possibly, larger homes and larger lots but with the high density monster project now underway, once complete, this suburb city will definitely be more Shanghai-d.

I predict that within 5 years this city will be non English, non French, a vast uniformity of monoculture. Just like what it was 100 years ago, when it was English speaking. Full circle. This city will be an icon of multiculturalism, where cultures are distinct and adjacent.

#223 Linda Mulligan on 02.10.14 at 8:32 pm

Re: #154 – let us just clear up one statement here. Every (legally) working Canadian does have a DB (defined benefit) pension plan. It is called the CPP. Every working Canadian who makes more than $3,500 per year must pay into this plan. They pay half, their employer pays the other half. IF you are self employed you get to pay both the employee & the employer share. So this oft repeated myth that ‘only’ government or unionized workers still have access to a DB plan is exactly that – a myth.

#224 gartho the blind dog on 02.10.14 at 9:09 pm

BANNED
[email protected]

#225 crowdedelevatorfartz on 02.10.14 at 9:58 pm

@#224Linda Mulligan

Ahhhhhh yes. The CPP. Another pension plan that requires drastic fiscal action just to keep it solvent. How much have the employer/employee contributions risen over the past 10 years just to keep it solvent?
The difference being. I will be able to access the CPP
However, I will not be able to access underfunded gov’t employee pensions…..
My tax dollars will go to “top up” federal, provincial and municipal gov’t employee pensions that I will be forced(through increased income tax, sales tax, etc)
Yes, CPP is a defined benefit pension…..That wouldn’t feed a dog….. and will go towards my taxable income for many years to come.
You’re splitting hairs.
The gov’t employee pension fiscal day of reckoning is coming. The fact that all you gov’t employees are so outraged at my comments merely proves that you’re all like ostrich’s with your heads in the sand when danger is imminent.
Good luck.
You’re all going to need it……

:)

#226 tim on 02.10.14 at 10:05 pm

76 Walltiger,
you are the loser. I don’t see evidence of anything that has been improved with the massive immigration. Housing has been bid up and there has been very little job growth from weathly immigrants who park there money here and do their business back in Asia.

#227 Andrew Woburn on 02.11.14 at 1:14 am

(UK) Rates start to rise on fixed five-year mortgages

http://www.telegraph.co.uk/finance/personalfinance/borrowing/mortgages/10623812/Rates-start-to-rise-on-fixed-five-year-mortgages.html

#228 CB on 02.11.14 at 2:14 am

#132 walltiger

Late response to you post, me lying about how the recent Chinese immigrant community abusing the system?? Obviously :

a) you don’t have any Mainland Chinese friends . They will tell you outright without shame the kinda of scam they are pullying.

or

b) you are a blind believer of Trudeau multiculturalism BS, let me tell you a little secret, it’s all about getting ethic votes.

{Rent: And my god talk about narrow minded racists, homopho and bigots, look no further, tell me last time you see any non-chinese work at an chinese owned business, or incident where the Mainland Chinese community support same sex anything.

But just go talk to a Mainland Chinese and ask them what they think about other race and gay people. Wow, this group really enhance the Canadian culture in a BIG way.}

See all the other responses to my post, even Chinese Canadian agree with what I said, because it’s the truth. The scamming or the Canadian immigration system it’s the biggest open secret in the immigrant community, it is retarded to pretend it is not happening.

BTW, some Chinese I know told me that you actually didn’t need to have the money for the investment immigration program or whatever that clusterfu#k is called, HSBC has a perverted mortgage type program where they will lend the $800K needed to qualify, they just need to service the interest.

Digging your head in the sand will not make these stupid policy or racial tension go away

#229 Dupcheck on 02.11.14 at 10:49 am

#189 walltiger

First learn how a question is asked. You use a question mark “?”. Apparently I am brighter then you, because I can see how some of you can abuse our immigration.

Second you are the bigot here. We as Canadians are not going to bend over for people like you to take advantage of our country. We will not stand for anyone that makes fun of us about how our system and gratitude is being abused. No matter where you are from, if they are here to abuse our system by just getting a passport and getting out; people like that do not deserve to be Canadians.

#230 CB on 02.11.14 at 4:05 pm

#229 CB

Sorry about the typo in my last post… trigger happy thumb and smart??phone autokey…. stupid interweb…