The big news

BIG modified

Is that little rascal F about to mess with mortgages again? Could be. CMHC, the federal agency which dominates the mortgage insurance business, without which untold numbers of moist virgins would never buy houses, has a big announcement set for Friday in Ottawa as the Peace Tower clock chimes eleven.

How do we know this? Because CMHC made an announcement that it has an announcement to announce. Reporters have been summoned. The mortgage industry’s vaguely apoplectic. Real estate boards are on alert. And speculation is rampant.

Not like we didn’t know this was coming. The recent federal budget (which blew up the Immigrant Investor Program and shocked Vancouver) said there would be “a number of further changes to the Canadian Mortgage and Housing Corporation, which includes reducing the amount of new guarantees CMHC is authorized to provide.” Hmm. What does that mean?

Among the bets mortgage brokers (who seem to have more time on their hands) are placing with each other:

* The minimum down payment to score an insured mortgage will rise from 5% to 10%.

* The threshold for mortgage insurance will be pushed from 20% to 30%. In other words, any buyer with less than about a third of the purchase price would be required to pay for CMHC coverage.

* A meaningful cap on the size of any mortgage to be insured will be implemented – similar to that imposed in the United States after the meltdown.

* A lowering of the sale price of houses qualifying for insurance. As you might remember, F already imposed a $1 million limit, meaning anyone buying a seven-figure property will not qualify for insurance, and therefore must have at least 20% down. Could this drop to, say, $800,000?

Well, as you might imagine, almost any of these changes would be a nuclear event in the pants of the real estate and mortgage business, especially the requirement of a 10% minimum down payment. The consequences would be immediate as buyers stormed the spring market like voracious locusts, devouring every listing in their path, panicked at the changes to come. And then, of course, prices would drop, making them all look like idiots.

So what are the odds?

Not high, actually. Given the run-up in prices in seriously whacked markets like Toronto, Calgary and Vancouver, changes of that magnitude would forever alter the lives of poor hipsters, yuppies and hormonal couples who would then have to spend decades in both therapy and their parents’ basements. Oh, the humanity.

So what’s the deal?

More likely CMHC will be announcing an increase in the amount of money the moist ones have to pay when they take out an insured mortgage. The agency hasn’t raised premiums in years, even though it’s easy to argue the risk of more defaults in any downturn has swollen substantially.

As you know, any time a buyer closes a deal with less than 20% down, insurance is a must. The smaller the amount of money you have, the more that insurance costs you. For example, with 20% down the premium would be 1% of the mortgaged amount. With 5% down, it escalates to 2.75%. How much CMHC will be raising the bar is unknown (until 11 am tomorrow, if that in fact is the announcement), but it’s likely to be a lot.

So will this deter the virgins from buying? Nope. That’s because almost everybody takes the CMHC premium, ignores it, then folds it into the mortgage principal, meaning it adds a few bucks a month with no need for cash upon closing. Unless, of course, that’s the news tomorrow – forcing new buyers to actually have the money to pay all closing costs. The impact of that would be substantial.

Or, maybe that’s not it at all. Veteran housing consultant Will Dunning says this might be about to happen: CMHC will establish a qualifying interest rate for fixed-rate mortgages with terms of five years or longer. There is already a benchmark rate if the kids borrow for a shorter term, but none for the five-year itself. That would mean an end to using the 2.99% special that I wrote about here a few days ago, and force everyone to qualify for financing at something north of 5%.

Then again, maybe F has arranged for all new homebuyers to get a free ticket to the PM’s next rock concert.

Wave your phones. Let it be.

UPDATE: Pfft. As expected, CMHC premiums are increasing, about 15%. Go back to hugging your dog.

229 comments ↓

#1 Mike on 02.27.14 at 7:40 pm

Whatever it is it won’t feel like a hug from the big white doggy :) At least not to mortgage brokers and RE agents.

#2 Cy on 02.27.14 at 7:40 pm

Where did u get the leak/info

#3 sky falll on 02.27.14 at 7:43 pm

the sky is falling, the sky is falling!!

#4 mitzerboy on 02.27.14 at 7:44 pm

Hungarian research has proved that dogs and humans have developed their brains together to communicate with each other…..

#5 Realist on 02.27.14 at 7:46 pm

Unlikely any substantive changes to happen with a looming election in 2015. Any new pronouncements will be window dressing.

#6 Interested Advisor on 02.27.14 at 7:49 pm

Am I really first? Should make for some interesting headlines and discussion tomorrow, hoping they throw some water on the fire.

#7 View on 02.27.14 at 7:54 pm

Working here in Ft Mac I have buddies working to pay for the real estate course and others buying places to renovate and flip or to rent out. Real estate only goes up is the phrase used. It seems they all think a fortune is to be made in Alberta property and not in discovering oil. One even said only 40% of Canadians own! Everyone thinks my portfolio of etfs and reits are stupid.

#8 NoName on 02.27.14 at 7:55 pm

orange guy is my hero!

We are pleased to inform you that your transfer from ING Direct has been initiated…
Please note that transfers may take anywhere between 5 and 25 business days for assets to be delivered.
today is FIRST business day

#9 AisA on 02.27.14 at 7:57 pm

A 10% minimum down payment could split the earths crust from Vancouver to St. John’s.

#10 Derek R on 02.27.14 at 8:00 pm

But it’s a steady drip of tightening measures. Each one having the effect of pushing down a little harder on house prices. One day we might even live in a high wage/low rent economy instead of the low wage/high rent economy that have just now.

Wouldn’t that be nice!

#11 Babblemaster on 02.27.14 at 8:03 pm

The Feds are loath to do anything that would hurt housing. The announcement regarding an announcement will prove to be anticlimatic.

#12 The Big L on 02.27.14 at 8:05 pm

I gotta do it………

FIRST!!!!!

#13 gladiator on 02.27.14 at 8:12 pm

The sheeple has been corralled.
Debt is the shackles of the new age and it’s time to lock them on the slaves’ arms and legs.
Time for some pain.

does this qualify as a haiku?

#14 Calgary Conditional Owner on 02.27.14 at 8:13 pm

Most of the scenarios you mentioned would bring prices down, but do you think at the same time home ownership would become more of a class thing? Currently almost everybody who’s employed qualifies to buy real estate, but it could be forced to become a more conscious and responsible decision in the future, which I guess would be good for personal finances throughout Canada.

Thanks.

#15 prairie person on 02.27.14 at 8:13 pm

Many years ago, I owned one of the first Great Pyrenees in Canada. Beautiful dog. As gentle as he was big.

#16 omg on 02.27.14 at 8:17 pm

Today Garth’s blog stated……

“So will this deter the virgins from buying? Nope. That’s because almost everybody takes the CMHC premium, ignores it, then folds it into the mortgage principal, meaning it adds a few bucks a month with no need for cash upon closing.”

Bloody Insidious – essentially what this means is those that default on their mortgages never actually pay for mortgage insurance – because the insurance premiums are all rolled into the mortgage. Its only the poor responsible suckers that pay their mortgages off that end-up paying their CMHC insurance premiums.

#17 ILoveCharts on 02.27.14 at 8:20 pm

You’ve got to think bigger Garth. CMHC is making so much money right now that they are going to start offering mortgages abroad and really rake in the profits for this country! Balanced budget 2015, Yeehaawww!!

#18 Son of Ponzi on 02.27.14 at 8:22 pm

Forget the Rock concert.
Harpo does not have a drummer.

#19 Cheep cheep on 02.27.14 at 8:25 pm

Whatever the announcement is, I hope it throws a bucket of cold water on the overheated housing market. Let’s hope CMHC don’t wimp out on us.

#20 Frustrated on 02.27.14 at 8:25 pm

I hope it all comes to an end after the spring market. How long can it last

#21 Na na na na na Nosty on 02.27.14 at 8:30 pm

Aggregator — Like Quiznos, Rome is calling it kwits too.

Blacksheep — Gold causes GW, AIDS and really good breakfast sausages with Fettucine Heart Attack Alfredo. PDollar, Manipulation and Currency Wars(PDF) Boy, is this ever a mixed-up world!

#22 TurnerNation on 02.27.14 at 8:32 pm

My, Bandit has grown.

#23 Don on 02.27.14 at 8:32 pm

Every change the fed has made to mortgage rules over the past few years, each designed presumably to take gas out of the bubble, ends up inflating it while everyone rushes in to beat the rule changes. Have they learned a lesson from that, yet?

If it is an increase to down payment requirements, is it likely to be any less loopholed that the current 5% down?

#24 Daisy Mae on 02.27.14 at 8:33 pm

It is just astounding how utterly stupid that trio in Ottawa has been. And now the ongoing frantic damage control they continue to implement. They must be sweating blood.

Are we going to remember this? ‘Cause that ‘little rascal’ will be blaming everyone but himself going forward….we know that, don’t we? Don’t we?

#25 DR on 02.27.14 at 8:36 pm

Should be interesting

#26 Wosniak on 02.27.14 at 8:37 pm

Me First!
Haven’t bought mine yet, still waiting for tomorrow. I hope they deflate the bubble.

#27 jan on 02.27.14 at 8:38 pm

There is another dark side of being a landlord folks.
Looks like that young women murdered in Halifax was just trying to collect back rent payment from tenants when she was murdered.

https://www.google.ca/url?sa=t&rct=j&q=&esrc=s&source=newssearch&cd=1&cad=rja&ved=0CCcQqQIoADAA&url=http%3A%2F%2Fglobalnews.ca%2Fnews%2F1177377%2Fhalifax-police-charge-roommates-in-loretta-saunders-murder%2F&ei=-NkPU_WgM-SQyAGY2ICADg&usg=AFQjCNF2aEmduiEAh2Kdw4WdWSt2Pzifdg&sig2=TuDUvxkn6e4BNnJG1RNSXw

#28 Victoria Real Estate Update on 02.27.14 at 8:40 pm

. .Percentage Price Increase / Decrease Since April 2010
. . . . . . . . . . . . . All Property Types. . . . . . . .
. . . . . . . . . . . (MLS Home Price Index). . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . *. . . + 12 %. . Canada
. . . . . . . . . . . . . . . . . . . . . . . . . . . . + 11 %. . (+11.8%)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . +10 %
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . + 9 %
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . + 8 %
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . + 7 %
. . . . . . . . . . . . . *. . . . . . . . . . . . . . . + 6 %
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . + 5 %
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . + 4 %
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . + 3 %
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . + 2 %
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . + 1 %
*. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0 %
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . – 1 %
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . – 2 %
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . – 3 %
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . – 4 %
. . . . . . . . . . . . . *. . . . . . . . . . . . . . . – 5 %
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . – 6 %
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . – 7 %
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . – 8 %
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . – 9 %
. . . . . . . . . . . . . . . . . . . . . . . . . . . . – 10 %
. . . . . . . . . . . . . . . . . . . . . . . . *. . . – 11 %. . Victoria
. . . . . . . . . . . . . . . . . . . . . . . . . . . . – 12 %. . (- 11.2%)
———————————————————————
April 2010. . . . . . . . . . . . . . . January 2014

This chart was put together with data from the MLS home price index.

House prices in Canada have increased by 11.8% since April 2010. In contrast, house prices in Victoria have dropped by 11.2% since that time.

Since 2010, single family home sales in Victoria have been well below the 25 year average (I will post that chart soon). As Garth has said many times, price drops follow declining sales. House prices in Victoria will fall much further than they have so far.

Canada’s frothy housing market is a classic example of a housing bubble. Housing bubbles have formed in many countries over the years.

As Alan Greenspan said:

“I have no particular regrets. The (US) housing bubble is not a reflection of what we did, as it is a global phenomenon.”

Canada’s housing bubble is, in general, no different than the bubbles that formed in the US, Japan, Spain, Denmark and Ireland. All housing bubbles burst and the result is always a deep price correction. House prices in Canada will peak soon and a major price correction will follow.

Victoria’s price correction began early compared to other Canadian markets. Of the bubbliest US markets, the early starters, in general, experienced the deepest price corrections. Victoria’s price correction will probably be the deepest in Canada.

Girls and guys, Victoria’s housing market has been extremely weak for years and prices will continue to fall. If you buy now you will almost immediately be in a position of negative equity. Millions of US families bought houses at or near the peak of the 2006 US housing bubble and realized later that it was a big mistake.

Renting in a falling housing market is financially savvy. Let prices fall further before you buy.

Until next time – Cheers!

#29 Smoking Man on 02.27.14 at 8:40 pm

No comments…. Wtf

#30 einsturzende neubauten on 02.27.14 at 8:40 pm

if you can not come up with (at least!) 20% downpayment (again: at least! in a sane universe thirty percent should be the norm) you have no job buying a house. period :-)

#31 Daisy Mae on 02.27.14 at 8:44 pm

“So will this deter the virgins from buying? Nope. That’s because almost everybody takes the CMHC premium, ignores it, then folds it into the mortgage principal, meaning it adds a few bucks a month with no need for cash upon closing.”

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

Exactly!

#32 TheCatFoodLady on 02.27.14 at 8:45 pm

Not knowing is both intriguing & frustrating & I’ve got no direct skin in the game – don’t own & am not contemplating buying.

In terms of what might be announced & looking at the required down payment – doubling the required down payment to 10% would be devastating to many about to enter the market. If someone has looked at that & can offer some estimated numbers – it would be much appreciated. I have no idea roughly how many buyers enter the market with 5% each year; I appreciate it varies but a rough idea would be nice. What’s the average down payment now?

If F wants to cool the market without gutting the entry level prices for a time, would it be worth while simply putting up the required down payment percentage to say… 7.5%?

I can see premiums going up if they’ve not been increased in that long. Here’s my question on premiums. If my total CMHC premium is $10,000 & I add it to the mortgage, does that translate to a fixed cost monthly over the amortization period or does it simply go into the money swamp owing, susceptible to interest rate rises & thus possibly a higher premium total when the mortgage is paid down? I don’t think so but… just asking.

Third & final question, if my CMHC house with total insurance premium of $10,000 is sold by me after 7 years, do I have to bring the remainder of the premium owing to closing day as a cheque made out to the government or is it simply ‘cancelled’ with the house sale?

TIA

#33 late learner on 02.27.14 at 8:47 pm

whatever it is, it could be a push towards housing correction and collapse. Currently i am renting 900ft two bedroom for 850 including everything. rent is going down in my area for 50 to 75 dollars.
i am very happy renting. less stress, tfsa, rrsp, resp all maxed out and saving of 1000 dollars a month.
I know my friends are chocked due to morgage payments and other house related expenses. financial matters is putting lots of stress in their relationship–will be providing emotional support to them when their relationship breaks down.
i am really scared. this will hurt lots of near and dear ones.

#34 Daisy Mae on 02.27.14 at 8:58 pm

Recently I observed a young wife leaving a mall RE kiosk loaded with pamphlets. And it was sad. She was obviously full of hope. And totally naive.

#35 Van Isle Renter on 02.27.14 at 9:00 pm

I have a tough time believing that they would “pre-announce” an announcement if it wasn’t something substantial. Upping the insurance rate is a fairly minor issue and I agree, won’t make any difference to anybody. On the other hand, I can’t see them doubling the downpayment. That would be way too drastic.

I could see them telling everyone that they need to get approved for a 25 year amortization before qualifying though. Or maybe upping the threshold for not needing it from 20% to 30%. That sounds like a good bet actually, as you rope in a whole pile of people that actually have $$ to mitigate the risk on the riskiest idiots. Banks would LOVE that one!!

Kind of like Obama is doing. Legislate that the healthy young invincibles must pick up the tab for the chain-smoking hard drinking wrinklies. Yeah, I can see that happening for sure.

#36 eddy on 02.27.14 at 9:02 pm

“Let it Be”?
Good guess. It won’t be “Taxman”
and it wont be’ “Everyone’s Gone To The Movies”
especially with his drummer still at large

http://www.youtube.com/watch?v=qf81ZxINQkQ&feature=kp

#37 waiting on 02.27.14 at 9:02 pm

Seen on another site talking about the CMHC announcement:

How do you keep an idiot in suspense?

I’ll tell you tomorrow.

#38 CCS on 02.27.14 at 9:08 pm

Garth, didn’t you say that the average down payment was 7%? What source were you using to get that information.

#39 Daisy Mae on 02.27.14 at 9:09 pm

“* A meaningful cap on the size of any mortgage to be insured will be implemented – similar to that imposed in the United States after the meltdown.”

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

See? The feds cannot think for themselves. We have idiots leading the country…if you want to call it that. I understand that this is just a possible scenario…but typical, judging from past performance.

#40 Aggregator on 02.27.14 at 9:10 pm

Find me one agency or any entity that installed an ex Goldmanite to tighten their balance sheet and only then I might believe CMHC is scaling back. Until then, they'll just keep duping everyone into thinking they're reducing taxpayer risk when insurers' consolidated balance sheets continues to expand

Don't expect much other then another pony show.

#41 Big John on 02.27.14 at 9:17 pm

And tomorrow’s announcement?

Absolutely, 100% guaranteed, nothing of substance…

For years the feds have cried wolf over debt, tweaked fringe elements of the mortgage industry, and spoken out of both sides of their mouths on programs that impact homeowners.

Alas, the paper wealth game of RE will continue, and all those on the sidelines will be waiting for another ‘2008’ crisis to make prices dip 10-15% in order to make your dreams of homeownership come true.

#42 jnohouse on 02.27.14 at 9:19 pm

If the change makes it even harder to buy it will spark a frenzy of people trying to get in raising prices YET again. The housing dream is even going to become father out of rich. I am resigned to my apartment and I make as much as my dad did. The people below better get used to my singing

#43 TS on 02.27.14 at 9:19 pm

What are the chances that the little F uses the word Hipster in his speech on Friday like Garth did in this article?

#44 Cici on 02.27.14 at 9:20 pm

Sweet pic.

Garth you forgot one…could they not also be raising the CMHC insurance premiums?

#45 CrazyCanuck on 02.27.14 at 9:21 pm

#32 CatFoodLady

For your Q#3
If you’ve financed your CMHC insurance, it’s paid by the bank to CMHC when your mortgage is created, and simply added to the amount you on your mortgage. You pay it off incrementally with your increased monthly payment. When you sell your house, the total mortgage balance has to be paid back for the mortgage to be discharged. Normally that is done with the proceeds of the sale, but if you were underwater you’ll be making up the difference.

#46 Cici on 02.27.14 at 9:24 pm

Oops, sorry Garth, I got ahead of myself ;-)

#47 Realtor # 1 GTA on 02.27.14 at 9:25 pm

You are right Garth
An increase in premiums will do nothing. On average it will
be an extra 25$ a month in carrying costs.

You guys need more to slow the demand. At this point job losses it what you need.

#48 CrazyCanuck on 02.27.14 at 9:26 pm

Hopefully the first change is to eliminate CMHC allowing banks to buy bulk insurance on their portfolio of low-risk (conventional) mortgages.

#49 Homeless in Canada on 02.27.14 at 9:28 pm

Flattery is so far behind the real estate curve its incredible. After going 5% 25 yr to 0% 40 yr terms in one fell swoop the idiot has been using a ball peen hammer to try and knock housing back onto its foundation.

He doesn’t have the brains or fortitude to do what required to fix his mess.

#50 High Plains Drifter on 02.27.14 at 9:34 pm

I often wondered what I would do if somehow, I could put some distance between me and the bloodhounds. By golly the rule changers are going to tear some hide off those late to the brambles. Capital, I can hear the hounds.

#51 Hawk on 02.27.14 at 9:36 pm

#11 Babblemaster on 02.27.14 at 8:03 pm.

What is deplorable is the government forever interfering in the marketplace. Encouraging housing yesterday……….discouraging housing today, the madness never ends. The marketplace solves its own problems better than any government ever has.

#52 Dog Lover on 02.27.14 at 9:36 pm

Garth, I would read your blog just for the dog photos.

We had a Great Pyrenees, a “rescue dog”. She had been badly abused and required about $1k in vet bills shortly after we got her. A great dog, but only gentle (very) with people. She was a deadly terror to other dogs (and bears) even though she had only a couple of stumps left for teeth.

She spontaneously used to stand on her hind legs and hug us just as in photo. Not something we encouraged her to do but it was very touching.

We could not take her into public places but since we live on a large farm property she had lots of room to patrol for any intruders. The last time we took her out she had ambushed two malamutes and forced them to lie on their backs waving their legs in the air. Very embarrassing.

#53 Bottoms_Up on 02.27.14 at 9:36 pm

Let’s make this fun, guesses, and a signed book for the winner?

I say:

New requirements of 8% downpayment for houses sold for $300,000 or less; 7% dp for anything above 300k.

And new limit for CMHC on homes worth 850k or less.

#54 HD on 02.27.14 at 9:37 pm

#32 TheCatFoodLady on 02.27.14 at 8:45 pm

I can see premiums going up if they’ve not been increased in that long. Here’s my question on premiums. If my total CMHC premium is $10,000 & I add it to the mortgage, does that translate to a fixed cost monthly over the amortization period or does it simply go into the money swamp owing, susceptible to interest rate rises & thus possibly a higher premium total when the mortgage is paid down? I don’t think so but… just asking.

Third & final question, if my CMHC house with total insurance premium of $10,000 is sold by me after 7 years, do I have to bring the remainder of the premium owing to closing day as a cheque made out to the government or is it simply ‘cancelled’ with the house sale?

The CHMC premium is directly added to the mortgage. If originally the mortgage was 300k, then it will be 310k and amortized accordingly. Resulting indeed in higher monthly payments + more interest.

The premium is directly paid to CMHC. Essentially, you borrowed money to pay for the insurance. As far as CMHC is concerned, they already got their money. So if you sale after 7 years, no need to send a cheque to the ‘government’ as they were already paid with borrowed money.

It is like using your credit card to pay your car insurance premium. The insurance company got their money and it is no longer a concern for them. But you still have to deal with the credit company for the debt of course.

Pretty sure this is how it works but if something is not accurate, the blog dogs will surely correct me.

Best,

HD

#55 Shawn on 02.27.14 at 9:38 pm

Warren Buffett

Is buying CMHC and will charge premiums that make sense for the risk.

Anyhow, whatever, it’s all entertainment to me.

#56 Relocated Aussie on 02.27.14 at 9:47 pm

Looking forward to the sound of a bursting bubble. Most RE agents tell me that the assessed value has nothing to do with the selling price. My theory is that if a house is fixed up really nice it will sell for a lot over assessed value. In mediocre condition it sells closer to assessed value. In terribly run down condition it quite likely sells for less than assessed. Some agents have agreed with my theory and a couple even admitted that they check assessed value before listing a property. Hopefully the prices will adjust to the point where a nice place will sell for exactly assessed price.

#57 Bob Rice on 02.27.14 at 9:48 pm

The only way this is going to return to sanity is if external forces/facotrs come into play… the govt isn’t going to wreck this train with election looming… Chiner will have to tank or US economy really takes off and rates go up

dumb Cdns…

#58 2cents Cdn on 02.27.14 at 9:49 pm

Obviously the little F-er is going to keep pulling the levers and twisting the dials until RE in Canada slows down. Over leveraged people or Boomers within a few years of retirement have one last chance to get a good buck for their house and lessen (or eliminate) dept and get (more) liquid. Tough times are coming for the ignorant …. finally!

#59 Ray Skunk on 02.27.14 at 9:55 pm

Downpayments should be 10% at least(15-20% is my personal opinion). 30% would absolutely kill the market and extreme measures aren’t exactly the hallmark of CMHC.

Lowering the insurable threshold would create a shitstorm of bidding wars; imagine 50+ offers on a SFH of $799,999.99.

Changing the cost of the premium will do very little, as Garth says, the virgins just roll this in and forget about it. Nothing but a cash cow, won’t do anything to ease the bubble.

Wildcard I’d like to see: no CMHC insurance available, at all, for anything other than primary residence.

#60 2or3orsometimes7 on 02.27.14 at 9:56 pm

Stumbled upon this tonight

http://terriblerealestateagentphotos.com/post/76348322708

#61 Ray Skunk on 02.27.14 at 9:58 pm

#32 – CatFoodLady

It’s a monthly payment. How the lender works it out (pays upfront/amortizes it for you with principal) I don’t know, but I do know when you sell up you don’t owe anything, nor is anything refunded.

#62 Nottal Sheeple on 02.27.14 at 10:04 pm

If it’s true that 70% of Canadians own their own homes, then no Flatulence Minister in his right mind would dare prick the Canadian housing gasbag of fake home equity just a year away from a federal election, any more than a parent would take away a child’s bag of teeth-rotting candy at the end of Hallowe’en.

#63 Bill Gable on 02.27.14 at 10:06 pm

Great Pyrenees is a huge hunk of love. A lot of Canadians are already in a world of hurt. I have many friends here in Vancouver that worked in entertainment and media and have skinny or no pensions. It is just cringeworthy how badly some of my cohort is doing.

Take it from Mr. Turner, if you don’t believe me – life goes by in a flash and if you don’t prepare for your financial future, the years that you will need comfort, instead will be colder than Harper’s heart.

#64 BossHogg on 02.27.14 at 10:06 pm

Whatever the announcement,it will be effective from May resulting in a roaring spring market.Must get the rest of the sheep in the barn…

#65 Freedom First on 02.27.14 at 10:09 pm

Well, I can’t say what the change will be tomorrow, but I can say that the usual suspects will still be pushing RE and that now is the time to buy.

What I can say is what I would like to see. I would like to see CMHC privatized. Of course all of the mortgages on the books would stand on today’s rules, however, with the new private ownership of CMHC, of course there would be rule changes, the biggest one being that the taxpayer is no longer the backer of any mortgages, as it should be. A genuine free market system. The profits should not remain to the people involved in buying/selling/pushing RE, while quite possibly there will be mega-losses falling on the backs of the taxpayers. That is outright theft and can not ethically be justified, and will only be justified by the profiteers who have no social consciousness, but are run by their own self serving greed, and have no right to tell society what is good for them. It is only mocking societies stupidity.

#66 ozy - ok, this is how Konservants loose power and we get Liberated on 02.27.14 at 10:10 pm

ok, this is how Konservants loose power and we get Liberated

HOOREY!

Vote them down!

#67 What about CMHC? on 02.27.14 at 10:12 pm

Finally! My question will be answered… or not… Likely not.

#68 Ralph Cramdown on 02.27.14 at 10:14 pm

These guys are in election mode, so I don’t think doing anything that would significantly dampen the market is too likely. The time to do something like that is at the beginning of your mandate. So it has to be something seen to be significant, but without too much near-term impact to house prices.

Perhaps privatization? Note that the government can’t repudiate responsibility for current insurance in force — that would be a default on a sovereign obligation. But it could announce that it won’t be writing any new business going forward, or narrowing its mandate. You’d THINK that anything that affected private insurers wouldn’t be announced during market hours…

BTW the market, in its infinite wisdom, thinks that it will be positive for Genworth, a private sector competitor:
https://www.google.ca/finance?q=TSE:MIC
…but not positive enough to get the price back to levels seen in January.

#69 economictsunami on 02.27.14 at 10:17 pm

Just about when we all come to fully comprehend that weather related poor economic data narratives are largely bunk, the ECB should be about to unleash their own brand of QE. Recent G20 promises of $2T carried miniscule actual new money.

(Remember when it was thought that central bank interventions were to provide short term liquidity, post Lehman’s?)

We have had many years of ongoing/ coordinated forms of currency alchemy from the PBOC, the Fed and BOJ.

Draghi’s “The euro would be saved by any means necessary…” is once again about to be seriously tested by debt skirting government to CB balance sheets; where there are seemingly no consequences…

Has a truly awful winter become our economic scapegoat?:

http://business.financialpost.com/2014/02/27/has-a-truly-awful-winter-become-our-economic-scapegoat/

Bad Weather to Blame for Consumer Spending Pullback? Numbers Argue Otherwise:

http://www.testosteronepit.com/home/2014/2/27/bad-weather-to-blame-for-consumer-spending-pullback-numbers.html

#70 Matt on 02.27.14 at 10:25 pm

read the bayview post today and noticed yours truly wasn’t in this years round table. What gives? Not suprisingly they all had a pro real estate tilt. Did you decline to participate this year?

Yes. It’s an advertising support panel. — Garth

#71 Barry in Pickering on 02.27.14 at 10:26 pm

@ SmartAlox

I bought my $5500 TFSA, and added it to the $30 000 worth of investments that I’ve already accumulated there. So when I earn my 8% this year, I’ll actually add $3340 tax free to my net worth. Next year, I’ll add $5500 more, and earn $3500 more on top of everything.
With this strategy, at the end of 5 years, my net worth will have increased over $91,000! After 10 years, my net worth will have increased by $168,888!
All tax free, and no commission.
Sounds like a plan, no?

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

No, it doesn’t sound like a great plan, because if you have 168K after 10 years, you are forgetting that you contributed 85K of it yourself. 30K to start with, and 5,500x 10 years in contributions.
So you have added 168,000-85,000= $83,000 from investments rising. Not bad, but not the $168K you are excited about. And worse, you are expecting a 8% return, which is more than most pension funds are getting.

#72 Half Full on 02.27.14 at 10:28 pm

Oh you tease us so, Garth!

#73 gogo on 02.27.14 at 10:28 pm

And the banks are lowering interest rate again…

#74 X on 02.27.14 at 10:32 pm

My guess is it will be to increase premiums, which really isn’t anything more than a PR move.

Too bad, so many opportunities to actually balance things out, but no impact on the markets.

#75 takla on 02.27.14 at 10:38 pm

times overdue they slowed down this realestate trainwreck,10 minites on google scanning realestate listings in detroit/Cleveland/buffolo would turn the most ardent ,moist house humpers gut.Hell,houses on city lots starting $100.00,,,,yes the deciple points in the right spot!cant happen in Canada you say……….watch out below

#76 Ontario's Left Coast on 02.27.14 at 10:52 pm

Instead of Let it Be, it should be “You never give me your money” but not “Baby you’re a rich man too.”

Smokey you crack me up… Why post a comment to say no comment? Cheers and I hope the writing went well in AZ.

#77 Same story since 2007 on 02.27.14 at 10:59 pm

It’s been more than 6 years ,and the same story happens every spring … Trying to change something, which in turns creates demand and nothing happens… Nothing is going to happen …

Just see the Canadian history , even in the worst interest rate crisis in the 80’s, Alberta dropped only around 10% … Which climbed back a few years and stayed there …. So people waiting for a huge crash , not going to happen…

#78 Exurban on 02.27.14 at 11:05 pm

Many many moons ago, Kemo Sabe, I bought mortgage insurance from MICC Mortgage Insurance Company of Canada. If I recall correctly it covered only 90% of the loan value, which if I am not mistaken is the same terms Genworth offers today. Maybe CMHC, which again if I am not mistaken insures loans at 100%, is from now on going to only cover 90% just like the private insurers.

If I am wrong this post will auto-delete, but if I am right you heard it here first blog dogs!

#79 Smoking Man on 02.27.14 at 11:20 pm

I would like to extend my thanks to the blog dogs who made me aware of Hunter S Thomson..

I watched a clip on you tube, to in the bag to remember the name, i was about his life….

Similarities hauntingly identical apart from my very limited and spastic technical skills when it comes to hitting keys.

Two manuscripts done. A satirical self help book and a fiction novel about my crazy life.

Both shit really bad. I can’t believe I wasted so much time on them.

After watching the clip it hits me in the head like a dislodged jet engine that fell from the sky of what I should write about.

Book 3 on the way. Burning the other two.. Boom… Deleted…

#80 rosie "moving forward" in the knowledge that, "this won't end well" on 02.27.14 at 11:21 pm

#13 gladiator

five syllables first
seven for the second one
five to end it right

#81 eastvan on 02.27.14 at 11:21 pm

I know F personally. He told me that the CONs are going to finance their “tough on crime” agenda by allowing CMCH to insure new privately owned prisons. They will ensure the prisons are profitable by filling them with environmentalists and antianything demonstrators.

#82 Top comment on 02.27.14 at 11:22 pm

http://www.cbc.ca/news/business/cmhc-may-alter-mortgage-insurance-terms-friday-1.2553758

Jack Sprat
How quickly people forget that it was Stephen Harper that allowed high risk $0 down/40 year amortized mortgage products to be sold in Canada for a year & a half before the 2008 financial crisis.
Our top five banks off loaded $75 Billion of their highest risk mortages to CMHC in exchange for $75 Billion that Stephen Harper BORROWED on our behalf. In less than a year Canada’s top five bank CEO’s were dividing up multi million dollar bonuses for limiting the risk to their institutions.
We as Cdns were told this bailout was a ‘cash infusion’ & that there was no ‘bailout’ of Cdn Banks with Cdn money(in honesty Cdn Banks also stood in line to access US TARP Loans thru their American subsidiaries).
Harper covered his bad political & economic decision by stretching the truth & hiding his mistake on the Books of CMHC which now holds many of the Mortgages he approved for sale in Canada – while we inherited the $75 Billion dollar debt debt incurred in the deal.

*Any wonder Big bank CEO’s luv Stevie & can you blame them?

#83 Smoking Man on 02.27.14 at 11:33 pm

Why do all you dogs obsess about money, life is about art, one ugly painting to you is a master piece to another.

You’re all celebrity worshiping dogs on a leash.. Money money money, her is my ring finger, kiss it you sub human vermin. That’s why you all want it so bad.

It’s because you think if you have It people will kiss your ass the way you currently kiss ass.

Buy a bungalow in longbranch, go to Southside Johnnys get hammered and paint something. Sing something, write something.

But kiss no rings..

That’s the secret to happiness..

#84 World According To Garth on 02.27.14 at 11:35 pm

And the list of countries pissed off at useless corrupt theiving govt workers grows:

http://armstrongeconomics.com/2014/02/27/rising-protests-now-in-azerbaijan-against-corruption/

Ukraine Spain Argentina Venezula Mexico Thailand

Good thing we live in Kanaduhhhh where there is no corruption and waste and taxes are fair….. Oh wait :-(

#85 Mark on 02.27.14 at 11:43 pm

“Just see the Canadian history , even in the worst interest rate crisis in the 80′s, Alberta dropped only around 10%”

Not true. Stories were abound in Calgary and Edmonton of “jingle mail”, where the underwater homeowner simply mailed the bank the keys. The drop was far more severe than 10%.

#86 TheCatFoodLady on 02.27.14 at 11:44 pm

Thank you all for the answers – clarifies more than a few things.

#87 learningfromyou on 02.27.14 at 11:46 pm

when I need a car to drive nobody has paid me the insurance for me. I had to do it myself

to have a house I must pay my own house insurance

to die properly, I must pay my own insurance to leave some bucks to my family.

why we pay the chmc insurance to insure the bank payments?

I’m sorry for this contradiction that I cannot justify, I wanted to see the banks paying for their insurance.

yes,yes, let me run to the bedroom and grab an advil for my head

#88 Same story indeed on 02.27.14 at 11:48 pm

#77 Same story since 2007 on 02.27.14 at 10:59 pm
Just see the Canadian history , even in the worst interest rate crisis in the 80′s, Alberta dropped only around 10% …

>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
You think saying it makes it true? Check the facts. Calgary’s prices: 100k in ’81, 50k in ’85. That’s 50% drop that will require 100% increase to get back, dude.
It took Calgary until ’06 to get back to 100k. That’s 11 years, if you need help.

#89 Same story indeed on 02.27.14 at 11:52 pm

…21 years… I know, I know. But the point is there just need to check the facts. 50% drop in prices is a mark that cannot written off as the immune nation.

#90 Markets on 02.27.14 at 11:57 pm

Funny thing with the markets in general, it takes them very little time on the way down compared to how long to go up. Wonder why is that… someone mentioned Fear? SM?

#91 Renter_4_ever on 02.28.14 at 12:07 am

You are really losing it now. YOu have not seen giant profits of these banks :) they already know what is about to happen. I wish I could show you a email which I received through internal communication department at work. Banks have lowered their 5 yr fixed mortgages 0.25% today. Banks already know what is going to happen and they already have made a solution of it already :). Believe me when I saw the email this morning I had no idea about the announcement from cmhc, I just found out after reading your daily crap, coz I am hooked to this daily dose of shit.

#92 HappyJack on 02.28.14 at 12:20 am

I ran across a quote which applies
to many things in life, including
Real Estate.

There are three kinds of men.

The one that learns by reading.

The few who learn by observation.

The rest of them have to pee on the electric fence for themselves.

Will Rogers

Keep Smiling

#93 bankruptcy geek on 02.28.14 at 12:32 am

The possibility of requiring 30% down is probably the answer since it screws savers who have been trying to be responsible and save enough to avoid the CMHC fees.

On the one hand you would think CMHC would want less exposure and increasing the the % to 30 means more exposure. But with the 30% down move they get more money and sure theoretically more exposure but really, anyone who has been waiting until they had 20% down, are a tad more financially literate and substantially less of a risk. So once again the financially responsible are used to fund the idiocy of the financially irresponsible.

Who, unless there is also a change to rates or required downpayment, have nothing to quell their desire.

#94 sideline sitter on 02.28.14 at 12:59 am

my guess: low-end won’t change, high-end will…. changes to max insured is my guess

#95 Freedom First on 02.28.14 at 1:20 am

Realtor#1GTA

This is not an anti-RE blog. Garth writes about being unbalanced. For sure R#1GTA you should relate with being unbalanced.

#96 Tony on 02.28.14 at 1:30 am

Doubling the minimum down payment to 10 percent from 5 would make the most sense.

#97 Joe on 02.28.14 at 1:37 am

Here’s my uneducated guess.
With all the hubbub and press pumping fuelled by the RE cartel.
Rates are going to lower and lending terms change foreshadowing a repeat of the US housing debauchaul.

#98 Kilby on 02.28.14 at 1:42 am

This announcement will amount to nothing, Flaherty and Harper are squabbling now. F is not going to run again and feels really guilty about what he has done to the economy…..Harper, of course does not care about Canada or Canadians, just getting ready to sit on all those oil companies boards…

#99 boom on 02.28.14 at 1:52 am

CMHC like the banks ie TD are just being proactive in doing what’s best to cover their asses when the rotten egg odors appear, they know storms a brewing.

#100 Crack Head Crackservatives on 02.28.14 at 1:58 am

I doubt the crack smoking crackservatives will do anything meaningfull like allow the free markets to take care of the housing market and not on taxpayer backed Crack House Mental Conservatives or CHMC. Crackservatives have lent out over $1,000,000,000,000.00 in sub prime mortgages in Canada which is in the biggest Crackhead housing bubble thanks to crackservative or AKA Harper’s Conservatives

#101 live within your means on 02.28.14 at 2:15 am

#17 ILoveCharts on 02.27.14 at 8:20 pm
You’ve got to think bigger Garth. CMHC is making so much money right now that they are going to start offering mortgages abroad and really rake in the profits for this country! Balanced budget 2015, Yeehaawww!!
…………………
Love the sarcasm.

#102 Smartalox on 02.28.14 at 2:30 am

Oh Barry,

I was talking about the increases in my net worth, which was the point that you were trying to make when you cited that Stats Can report that you claim means everybody who owns real estate has a high net worth.

You’re absolutely right, in the time that I would be contributing to my TFSA, most of the increase in my net worth would come from my own capital contributions. But at the end of the day, all that money that I contributed – plus the gains – are still mine to spend – tax free, right Veej?

Over the same period however, someone who put $17,500 down on a $350 000 home would have paid $90 909 in interest to the bank (bye bye, money) to increase their net worth by only $99 800 (the original $17 500, plus $82,300 paid down on the mortgage). The property owner would ALSO have more than $250 000 worth of debt to pay off on the mortgage.

My net worth after 10 years: +$168 000.
The homeowner’s net worth: -$159 091.

#103 live within your means on 02.28.14 at 2:30 am

#24 Daisy Mae on 02.27.14 at 8:33 pm
It is just astounding how utterly stupid that trio in Ottawa has been. And now the ongoing frantic damage control they continue to implement. They must be sweating blood.

Are we going to remember this? ‘Cause that ‘little rascal’ will be blaming everyone but himself going forward….we know that, don’t we? Don’t we?
………………….
Unfortunately, few too many do.

#104 live within your means on 02.28.14 at 2:45 am

#24 Daisy Mae on 02.27.14 at 8:33 pm
It is just astounding how utterly stupid that trio in Ottawa has been. And now the ongoing frantic damage control they continue to implement. They must be sweating blood.

Are we going to remember this? ‘Cause that ‘little rascal’ will be blaming everyone but himself going forward….we know that, don’t we? Don’t we?

Report on Business
Special investigation: How high-risk mortgages crept north

http://www.theglobeandmail.com/report-on-business/special-investigation-how-high-risk-mortgages-crept-north/article1067885/?page=all

#105 Rabbit One on 02.28.14 at 2:53 am

>#32 CatFoodLady

CMHC Premium is like (not exactly, but) travel insurance. You pay in advance for your full trip plan,
if you decided to cancel your tip and return home early, there is no refund or to pay additional premium.

CMHC premium to roll in to your mortgage is optional.
Apprently to include into your 25, 30 years amortization mortage, (if you stay at same place for as long as amort. years), the cost it will be doubel or more.

Having said that, CMHC premium included in mortgage is optional – is contradiction.
Those who only can put less than 20% cannot pay CMHC premium cash at closing.

True, it is no big deal for CMHC premium increase of 1 or 2 or even 3% point because of tghis reason, but what if new rule is you cannot roll in your premium into your mortgage, but have to come up with cash by the time purchase closed?

#106 Tom from Mississauga on 02.28.14 at 3:11 am

Flaherty pawning off CMHC rule change on a bureaucrat…before the spring RE market…after the banks report Q1…

No sleep tonight.

#107 saskatoon on 02.28.14 at 3:21 am

QUANDARY:

i know that house prices (hisorically) have short-term busts…but is there any evidence to show that house prices don’t go up and up long-term?

in other words, is there a high price point that average SFH hit in the past…that was NOT surpassed, following a prolonged bust/stall?

is it possible that house prices NEVER again reach the heights they are at, say, today?

is there evidence for this?

OR, if you wait long enough…(perhaps a few decades)…does real estate eventually surpass (or, at least attain) previously held highs?

is this simply an inflation issue?

#108 Humpty Dumpty on 02.28.14 at 4:48 am

First the latest news..

35 million gallons of coal ash spilled into Dan River

Coal ash is the residue that’s left behind after coal is burned. It contains toxic chemicals such as arsenic, mercury, and lead, as well as aluminum oxide, iron oxide and more.

http://rt.com/usa/dan-river-coal-ash-spill-897/

CA environmental group takes on govt agreement with oil company to dump chemicals

Waste created by land fracking is dangerous because it is known to contain methanol, benzene, naphthalene, and other components that are used to break up the underground rock. Yet California’s KCET, an independent public television station, reported the waste that has been dumped into Santa Barbara Channel is even more problematic because of the delicate ecosystem off the coast of Southern California.

http://rt.com/usa/environmental-govt-agreement-dump-chemicals-098/

B.C. waters threatened by microplastic pollution

http://www.cbc.ca/news/canada/british-columbia/b-c-waters-threatened-by-microplastic-pollution-1.2543367

Fukushima radiation hit B.C. earlier than expected

http://www.cbc.ca/news/canada/nova-scotia/fukushima-radiation-hit-b-c-earlier-than-expected-1.2552718

#109 Humpty Dumpty on 02.28.14 at 4:52 am

Now some very interesting news…

How Covert Agents Infiltrate the Internet to Manipulate, Deceive, and Destroy Reputations

Among the core self-identified purposes of JTRIG are two tactics: (1) to inject all sorts of false material onto the internet in order to destroy the reputation of its targets; and (2) to use social sciences and other techniques to manipulate online discourse and activism to generate outcomes it considers desirable.

https://firstlook.org/theintercept/2014/02/24/jtrig-manipulation/

Enjoy your weekend!

#110 OttawaMike on 02.28.14 at 5:39 am

#40 Aggregator on 02.27.14 at 9:10 pm

After a quick look at your chart, I have to wonder out loud if the insurer’s balance sheets got expanded in tandem with the increase in housing prices?

From 98-08 it roughly doubled as did the price of homes in our major centres. From 08-13 it rose again to reflect the further 20-30% price increases.

Add a little more in to account for the loosened mortgage rules from 05-12 period and there really is nothing earth shattering in there from what I see.

#111 Buy? Curious? on 02.28.14 at 6:19 am

Garth, Garth, Garth, what is going on with the pictures? You used to put one up that juxtaposed to the content of your post. What does this one, with the lady happily hugging a massive dog, have to do with the CHMC announcing that they will be using brown bread instead of white bread for all their Tuna and cuccumber sandwiches from now on? The lady AND the dog look happy, real happy. Do you really think that something is going to happen that’s going to makes us feel warm and fuzzy?

Let’s get in touch with our roots. Where it all began with some tough questions. Is now a good time to buy a condo? If I don’t buy now, will I be priced out of the market forever? Is Sherry Coooper seeing anyone serious?

Don’t let the fame change you, man.

https://www.youtube.com/watch?v=CPtfsRNKPv8&feature=player_embedded#at=11

Rob Ford is a politician you can’t trust and I’m ok with that. I just want to get a Selfie with him and my kids.

#112 World Traveler on 02.28.14 at 9:27 am

#79 Smoking Man on 02.27.14 at 11:20 pm
I would like to extend my thanks to the blog dogs who made me aware of Hunter S Thomson..

*****

Woah woah!

You’re a writer and you didn’t know who Hunter S was?

#113 Ralph Cramdown on 02.28.14 at 9:54 am

#112 World Traveler — “You’re a writer and you didn’t know who Hunter S was?”

The moniker is ‘Smoking Man,’ not Renaissance Man or Book Learnin’ Man. Hunter S didn’t write anything in Visual Basic, so SM never had occasion to google it and copy’n’paste it into his own works…

Now Ralph Steadman, there was a credit to Ralphs everywhere!

#114 Stickler on 02.28.14 at 10:03 am

@ #87 learningfromyou on 02.27.14 at 11:46 pm

” why we pay the chmc insurance to insure the bank payments?”

———————————

Because banks rule the world.

Another example:

RBS just announced it lost money for the 6th straight year…

RBS was bailed out by taxpayers during the financial crisis of 2008 and 2009 with a £45bn investment

Despite the increased loss, RBS set aside £576m for staff bonuses in 2013

#115 Vangrrl on 02.28.14 at 10:18 am

On CBC this morn ‘Hidden camera investigation reveals atrocious investment advice (by banks)’… Haha, ya don’t say?!

#116 TheCatFoodLady on 02.28.14 at 10:22 am

A few days ago, Garth referred to Kingston’s RE market & told us sales were down 19% in January ’14 compared to January ’13. Yup – total sales of SFH for this January were listed as being 119 units with an average price of $280,186. There was roughly 11 months of inventory.

Last night’s weekly community paper provided an update from KREA. Interestingly, they only list 111 SFH sales; I’m assuming 8 fell through & I’m thinking on the lower end on price ranges because now the average SFH sales price is noted as being $291,497. But that’s almost a 22% decline from January last year.

Sales are broken down by price range & most sold homes are in the $220-400K price range. Nothing in January sold if it was priced $750K or higher.

Listings are climbing – I went through the flyer & a lot of listings are retreads from last year that had been yanked from the market. No numbers in for February but from what I saw in my local travels – it was dead.

There are a lot of open houses this weekend coming & weather shouldn’t be an ‘issue’. Locally, CIBC has had a mortgage push since right after Christmas, telling customers interest rates have never been this low.

Yup – the spring market locally will be interesting. The spring market seems to be kicking off this weekend.

#117 Smoking Man on 02.28.14 at 10:25 am

#112 World Traveler on 02.28.14 at 9:27 am

#79 Smoking Man on 02.27.14 at 11:20 pm
I would like to extend my thanks to the blog dogs who made me aware of Hunter S Thomson..

*****

Woah woah!

You’re a writer and you didn’t know who Hunter S was?
…………….

I’m a writer not a reader… A dumb consumer of someone else’s imagination.

I don’t even consider my not so perfect technical ability as a weakness, it’s a strength.

Won’t make sense to a two dementional thinker.

#118 Nemesis on 02.28.14 at 10:27 am

@SM/#83…

Correct. “Ars Longa, Vita Brevis”

#StrangerThanFiction #FridayZen

[FT] – The trick of the mistress trade: High finance illustrates that for married men who stray there are two kinds of money

…”A veteran of Credit Suisse and Lazard, Mr Hixon had worked most recently at Evercore Partners, which has said it fired him “for cause” in January.

The government’s allegations portray Mr Hixon – a 56-year-old banker widely known as “Perk” – as a classic case of a married man who needed money that his wife wouldn’t know about. The US Securities and Exchange Commission says he had fathered a daughter – now five years old – during the course of a years-long relationship last decade with a woman about two decades his junior called Destiny Wind Robinson.

To help pay for Destiny’s child, as it were, the government alleges that Mr Hixon trafficked in sensitive corporate secrets – a store of value well suited for a player looking to pay off personal obligations without leaving a paper trail. Relying on material, non-public information that he obtained as a senior Evercore adviser on mining and metals deals, Mr Hixon engineered stock trades in his former lover’s brokerage account that yielded almost $900,000 in profits, according to the SEC.”…

http://www.ft.com/intl/cms/s/0/e736c18c-9ee7-11e3-8663-00144feab7de.html?siteedition=intl

[NoteToGT: Seriously, I’d have run that one as: “Destiny has its Perks”]

#119 Aggregator on 02.28.14 at 10:36 am

#110 OttawaMike

Correct. As can be seen in this chart showing consolidated IIF and GIF (mortgages, HELOCs, etc.) as a percentage of total household debt is 0.9964 correlated, meaning, CMHC, Genworth and securitizations have been and still are the primary driver of home prices. Alas, if they pull back insurance and guarantees, it's game over, which is why they won't, and more likely to come up with some other ABC scheme to divert liabilities from the public and investors like they've been doing for years. At least until they are forced to unwind. 

Essentially what you have here is a classic ponzi scheme, where in order to protect the value of banks and insurers' assets, more insured and securitized loans must made, otherwise the market collapses.

#120 Steven on 02.28.14 at 10:40 am

Since the number of ounces of silver bullion in the world and the number of houses in the world are about the same the logic is that the price of silver equals one house. With the world population at 7 billion and the above ground stock pile of siler at roughly 1 billion ounces that is a person per ounce ratio of 7 to 1.
It is ridiculous that silver be so cheap and a house be so expensive. Assuming a 350,000 dollar house price and 21 dollar silver that would be 16,666.67 ounces of silver which is silver for 116,666.67 people. On the average almost all the people Of Barrie Ontario could buy one house between the lot of them at market prices. On the other hand if the number of houses are equal to the number of houses in the world then offering silver to the market for the average local house price is clearly justified and I don’t think that is roughly $21 an ounce.
Considering Canadian real estate prices and that I am required to deal with them in march I will have to make such an offer to my bank : Silver at the average house price per ounce.

#121 2CntsCdn on 02.28.14 at 10:43 am

Off the topic a bit
….. does anyone on here have their own business and an operating bank loan? (maybe secured with receivables, inventory and possibly a little collateral Mtg).

I know two people who’s banks in the last month have come along at renewal time and (although both companies have been solidly in the black with no slow down issues) have asked for substantially more security in the form of a cash influx or extra mortgaging property (personal or business building).

This wreaks of 1992 (start of that big recession) ….. my business’ bank came along and asked for double the security in 3 weeks … although we had 14 years of strong sales and business results. We were furious but had no choice ….. we mortgaged everything including the kitchen sink, survived ….. and grew to great levels in the 2000’s. But many many businesses were wiped out.

The banks reasoning was that “word from their head office above” was that their feeling was that the economy was about the get tough … and banks were limiting exposure and demanding more security protection and (although they wouldn’t use these words) … shake out the week businesses.

The banks by tightening the screws and “protecting themselves” from a recession … actually initiated, accelerated and deepened one.

I’d like to hear if any business owners have gotten a bad news visit from their banks recently.

My point of all this is that …. the country is hurting more than we’re hearing. The RE industry isn’t the only ones who are good at working MSN and masking numbers and the truth.

When the banks “tighten” ….. businesses start failing …. jobs get lost. The “R” word starts getting used a lot …. butt-holes pucker ….. spending slows …… people stop buying …… RE is out of vogue and gets hammered “Survival” becomes the new catch phrase.

This could be the start.

#122 Daisy Mae on 02.28.14 at 10:47 am

#49 Homeless in Canada: “He doesn’t have the brains or fortitude to do what required to fix his mess.”

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

And these brainless feds had the unmitigated gall to show Garth the door when Garth said ‘0/40 amortizations wouldn’t work’.

#123 Smoking Man on 02.28.14 at 10:56 am

Currency Traders ALERT!!!!!!

looks like a double Batman on USDCAD.

reverse the longs… Stop out at 1.1128

#124 Buy? Curious? on 02.28.14 at 10:56 am

Hey Garth, ever notice how the crazier the comment, the later it is? These nutjobs are either up late or on the west coast! Don’t believe me? Go look at some of the crazier posts and look what time they come in at!

Anyway, I found a video about the different types of welfare there are and how some people benefit more than others and I don’t think they’re referring to poor people.

http://www.youtube.com/watch?v=-rtySUhuokM#t=332

“Hey Vancouver! Your city sucks and it’s in the second suckiest province in Canadada!” *gives the finger*

#125 Daisy Mae on 02.28.14 at 11:01 am

#54 HD: “The premium is directly paid to CMHC. Essentially, you borrowed money to pay for the insurance. As far as CMHC is concerned, they already got their money….”

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

Seller either absorbs the loss or passes it on….and the new buyer with modest down payment, pays again.

#126 RVP on 02.28.14 at 11:01 am

Court ruling on a wrongful dismissal case is highlighting how CIBC policy allows wealthy people in China to circumvent China’s capital control in order to bring money to Canada and (quite often, and in this particular case) invest it in real estate. From the BC Court ruling:

“As a result of Chinese regulations at the time, each individual was restricted to transferring no more than $50,000 USD abroad annually out of China. Working around these regulations was a challenge and a complicated process, but it was a practice CIBC supported. There is no issue about this. If, for example, a CIBC client wanted to send $150,000 from China to Canada, the money had to come from three accounts belonging to three different account holders in China and be transferred to three separate accounts belonging to three separate account holders in Canada. As long as all the appropriate accounts were set up, the money could be moved.

[165] In order to work around the Chinese transfer limits in this case, Ms. Xu needed 10 different account holders in China to send wire transfers to 10 different accounts in Canada. And she ran into a problem.

[166] On September 9, 2010, in the middle of the night, Ms. Ogden received a phone call from Ms. Xu. She was in a panic. She was short two accounts to bring in two wire transfers of $50,000 USD. Ms. Xu was calling from Vancouver, but she had two people at a bank in China at that very moment – with the 16 hour time difference it was business hours in China – ready to wire the funds from their respective accounts. The urgency was that the deal on Ms. Xu’s $5.7 million home would collapse if the funds weren’t transferred immediately as the deposit funds had to be in Canada the following day to secure the offer.”

http://www.courts.gov.bc.ca/jdb-txt/SC/14/02/2014BCSC0285.htm#_Toc380741131

#127 Daisy Mae on 02.28.14 at 11:05 am

#56 Relocated Aussie: “Most RE agents tell me that the assessed value has nothing to do with the selling price….

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

Assessed values are closely tied to mill rates.

#128 Daisy Mae on 02.28.14 at 11:08 am

#57 Bob Rice: “…the govt isn’t going to wreck this train with election looming…”

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

They already have. What they’re doing now, is damage control. Whatever they do won’t be enuf.

#129 Derek on 02.28.14 at 11:20 am

So basically put the in the coffin for condo buyers. But SFH are safe cos very few puts 5 or 10% down on it.

#130 Sheane Wallace on 02.28.14 at 11:26 am

http://www.bloomberg.com/news/2014-02-28/gold-fix-study-shows-signs-of-decade-of-bank-manipulation.html

It seems boolean bankers are in trouble.

#131 Daisy Mae on 02.28.14 at 11:32 am

#87 Learningfromyou: “I’m sorry for this contradiction that I cannot justify, I wanted to see the banks paying for their insurance.”

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

They’d just pass costs along to the consumer so it’s the same difference.

#132 Sheane Wallace on 02.28.14 at 11:39 am

darn spell checker,

bullion banks

#133 Joe on 02.28.14 at 11:44 am

Uneducated guess part 2.
The announcement will be something that will scare the herd to buy now.

#134 Nemesis on 02.28.14 at 11:45 am

#BonusZen

[UK Telegraph] – What your man-bag says about you

…”

Only journalists writing about man-bags call them man-bags. And people commissioning surveys, such as the one which recently discovered that some 50% of us are now in possession of one (a man-bag). 11% of us even use them to make fashion statements, just like women do, the survey said.

Even if you have no conscious desire to make any sort of statement at all, one’s bag, we’re told, speaks volumes about its carrier. So proceed with caution. “…

http://www.telegraph.co.uk/men/fashion-and-style/10660509/What-your-man-bag-says-about-you.html

#135 Rainclouds on 02.28.14 at 12:00 pm

Agree with others here:

This will be a hamfisted attempt by Tubby and the Elf to goose the spring market. Gotta keep the good times rolling. All policy changes to take effect in July 1.

If the markets tank and the smartest guy in the country gets whacked in the 2015 election and Rob Ford’s best buddy quits then somebody else is stuck with the mess.

#136 TheCatFoodLady on 02.28.14 at 12:04 pm

15% roughly, premium hike on CMHC insurance = on average $5 a month more for home owners. Much ado about very little.

#137 broadway skytrain on 02.28.14 at 12:04 pm

OTTAWA, February 28, 2014 — Following the annual review of its insurance products and capital requirements, CMHC will increase its mortgage loan insurance premiums for homeowner and 1 – 4 unit rental properties effective May 1, 2014.

The increase applies to mortgage loan insurance premiums for owner occupied, self-employed and 1-to-4 unit rental properties, including low-ratio refinance premiums. This does not apply to mortgages currently insured by CMHC.

CMHC’s capital management framework is consistent with international practices and Canadian guidelines for mortgage insurers. Increased capital targets are consistent with Canadian and international industry trends and makes the financial system more stable and resilient.

“The higher premiums reflect CMHC’s higher capital targets” said Steven Mennill, CMHC’s Vice-President, Insurance Operations. “CMHC’s capital holdings reduce Canadian taxpayers’ exposure to the housing market and contribute to the long term stability of the financial system.”

For the average Canadian homebuyer requiring CMHC insured financing, the higher premium will result in an increase of approximately $5 to their monthly mortgage payment. This is not expected to have a material impact on the housing market.

Effective May 1st, CMHC Purchase (owner occupied 1 – 4 unit) mortgage insurance premiums will increase by approximately 15%, on average, for all loan-to-value ranges.

Loan-to-Value Ratio Standard Premium (Current) Standard Premium (Effective May 1st, 2014)
Up to and including 65% 0.50% 0.60%
Up to and including 75% 0.65% 0.75%
Up to and including 80% 1.00% 1.25%
Up to and including 85% 1.75% 1.80%
Up to and including 90% 2.00% 2.40%
Up to and including 95% 2.75% 3.15%
90.01% to 95% – Non-Traditional Down Payment 2.90% 3.35%

#138 Ralph Cramdown on 02.28.14 at 12:05 pm

“For the average Canadian homebuyer requiring CMHC insured financing, the higher premium will result in an increase of approximately $5 to their monthly mortgage payment. This is not expected to have a material impact on the housing market.”

A nothingburger.

#139 Ray Skunk on 02.28.14 at 12:05 pm

Premium increase.

$1800 extra on a $450k property with 95% LTV.

Yeah. This is going to make a difference.

Sigh.

#140 Aggregator on 02.28.14 at 12:07 pm

*CMHC INCREASES MORTGAGE PREMIUMS
*ON 95% LTV THE STANDARD PREMIUM RISES FROM 2.75% TO 3.15% EFFECTIVE MAY 1, 2014
*INCREASE WILL HAVE NO EFFECT ON CURRENTLY INSURED MORTGAGES
CMHC: "HIGHER PREMIUMS REFLECT CMHC'S HIGHER CAPITAL TARGETS"

Zero impact. Yawn.

#141 Sotiri on 02.28.14 at 12:08 pm

CMHC to Increase Mortgage Insurance Premiums

http://www.cmhc-schl.gc.ca/en/corp/nero/nere/2014/2014-02-28-1100.cfm

#142 broadway skytrain on 02.28.14 at 12:09 pm

small potatoes, very small.

#143 First World Problems on 02.28.14 at 12:10 pm

Here’s the CMHC Press Release:

http://www.cmhc-schl.gc.ca/en/corp/nero/nere/2014/2014-02-28-1100.cfm

#144 gladiator on 02.28.14 at 12:15 pm

CMHC increases premiums by up to 0.4 percentage points and that’s it. Let the madness go on.

The news that wasn’t.

#145 fixie guy on 02.28.14 at 12:16 pm

#105 Rabbit One: “CMHC Premium is like (not exactly, but) travel insurance.”

Like travel insurance that protects the airline instead of the passenger at the passenger’s cost.

http://www.moneysense.ca/debt/your-cmhc-insurance-doesnt-protect-you

#146 Republic of Jon on 02.28.14 at 12:16 pm

Welp. CMHC raised premiums. Looks like Garth was right.

G&M says it works out to be about an extra $5/month for the average homebuyer.

#147 JonB on 02.28.14 at 12:20 pm

Yeah that was a real “corker” announcement

#148 Gyga on 02.28.14 at 12:23 pm

Madness continues. Let everyone in 416 be a RE millioner, yahooooo

#149 rosie "moving forward" in the knowledge that, "this won't end well" on 02.28.14 at 12:28 pm

http://www2.macleans.ca/wp-content/uploads/2012/10/Flaherty-laughing.jpg

#150 A Yank in BC on 02.28.14 at 12:28 pm

Much ado about nothing. Move along folks.

#151 Ret on 02.28.14 at 12:31 pm

$5 a month will help to capitalize CMHC in the event that loan losses mount?

Yeah, right.

#152 Bottoms_Up on 02.28.14 at 12:40 pm

95% Loan-to-Value
Loan Amount $150,000 $250,000 $350,000 $450,000
Current Premium $4,125 $6,875 $9,625 $12,375
New Premium $4,725 $7,875 $11,025 $14,175
Additional Premium $600 $1,000 $1,400 $1,800
Increase to Monthly Mortgage Payment $3.00 $4.98 $6.99 $8.98

#153 Kilby on 02.28.14 at 12:43 pm

Welp. CMHC raised premiums. Looks like Garth was right.

G&M says it works out to be about an extra $5/month for the average homebuyer.

Way to slow down the “overheated” real estate market! Herr Harper doesn’t want to upset the boat and is hoping things will hold off until the next election where he can put the blame on the NDP/Liberal colition government…..Ha!

#154 Daisy Mae on 02.28.14 at 12:44 pm

“Starting in May, the housing agency will charge an average of about 15 per cent more to insure mortgages, CMHC said in a release Friday.”

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

So this won’t change a thing. Buyers will simply roll the cost over into their mortgage. But it WILL increase government revenue…and might be a way of paying off government debt before the election call?

#155 Paul on 02.28.14 at 12:52 pm

#140 Aggregator on 02.28.14 at 12:07 pm

*CMHC INCREASES MORTGAGE PREMIUMS
*ON 95% LTV THE STANDARD PREMIUM RISES FROM 2.75% TO 3.15% EFFECTIVE MAY 1, 2014
*INCREASE WILL HAVE NO EFFECT ON CURRENTLY INSURED MORTGAGES
CMHC: “HIGHER PREMIUMS REFLECT CMHC’S HIGHER CAPITAL TARGETS”

Zero impact. Yawn.
———————————————————- Zero impact. Yawn,
Not really had two fence sitter’s submit offers yesterday to get ahead of the ‘big news’
All the buzz just pushes people in.No matter that you advise the announcement be no big deal!

#156 Blaine Monaghan on 02.28.14 at 12:54 pm

Wow! I can’t believe they felt that announcement warranted a pre-announcement. Reminds me of the boy that cried wolf. Won’t bother paying attention next time. New board has just lost some credibility.

#157 Daisy Mae on 02.28.14 at 12:55 pm

#136 TheCatFoodLady: “15% roughly, premium hike on CMHC insurance = on average $5 a month more for home owners. Much ado about very little.”

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

Enuf to spur on the ‘moist virgins’. Gotta get in under the May deadline, ya know…

#158 TOS ATP AT guru on 02.28.14 at 12:55 pm

Was this CMHC NEWS?

Are they all Retarded in CMHC??

The announcement of this announcement?

OMG !!!!!!!!!

Tax payers get out of canada while you can !
or you will be paying AGA stoves in corn-pressed-glued houses

F has lost his mind ! He is officially DEMENTED !

#159 Rational Optimist on 02.28.14 at 12:58 pm

Logically, every market segment with any amount of first-time home-buyers just lost 0.4% in price, right? Hey, it’s something…

#160 Daisy Mae on 02.28.14 at 12:59 pm

#142 broadway skytrain: “small potatoes, very small.”

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

We wouldn’t want to upset the lucrative RE apple cart. We wouldn’t want to upset the electorate, would we?

#161 Fed-up on 02.28.14 at 12:59 pm

Wowwwwwww….a whole $5 per month.

Why did they even bother???

Let the reckless bidding wars continue!!!

#162 Bottoms_Up on 02.28.14 at 1:06 pm

#145 fixie guy on 02.28.14 at 12:16 pm
—————————————–
CMHC doesn’t protect the homebuyer, but allows the homebuyer to gain access to funds to buy a home that they otherwise wouldn’t be able to buy because otherwise the banks wouldn’t lend to them.

#163 Randis on 02.28.14 at 1:09 pm

http://www.theglobeandmail.com/report-on-business/cmhc-to-raise-mortgage-loan-premiums-may-1/article17159342/

Garth I have a question … The article says “… The banks are technically responsible for the premiums, but they are almost always passed on to the buyers …”

Here is the thing, I agree banks should pay the premium because they are the ones who decides to take on the high-risk business. But then for the buyer to be able to take out a mortgage, they have to pay the premium for the banks otherwise the bank won’t lend the money …

My question is, is this considered tied-selling?

#164 Bottoms_Up on 02.28.14 at 1:10 pm

#135 Rainclouds on 02.28.14 at 12:00 pm
——————————————
May 1st for the changes (still beefs up March and April).

And how do you think that rich investors fund is doing betting against our housing market? Banks beating estimates and raising divies….GDP up, Canada running a December surplus….they’re even hiring again in Leamington.

#165 running scared on 02.28.14 at 1:13 pm

I can just hear all those moist virgins now… $5 MORE PER MONTH…NO WAY!!. THAT’S IT WE’RE NOT BUYING. You got them running scared now little pecker.

#166 Hillbilly on 02.28.14 at 1:14 pm

Well, now you know the government’s game plan when it comes to housing in Canada.

This CMHC announcement will have no effect on house pricing. Nor is intended to – it’s just window dressing.

What did you expect? – the government was going to ACTIVELY move to kill the biggest part of the economy?

No policy enacted so far has had any effect other than to drive more purchases “before the rule changes come into effect”.

No, the plan is clear here.
Let the market go unfettered until it run out of buyers or prices become completely unaffordable.

Then point to housing price decline and say “it’s the market, what can we do?”

Great leadership, eh?

#167 BCD (D for DMHC) on 02.28.14 at 1:17 pm

Garth. One could sense the “eager doomer” coming out of you in the speech above. . .lol As it turns out the CMHC announcement about an announcement turned out to be. . . . . .”flaccid”??? Further evidence of the impotence of this organization.

They should have just said they were adding one Starbucks latte to the cost of premiums. This is much more accessible to trendy RE seeking fashonistas.

In other news TGIF to the doomer minions!

#168 bdy sktrn on 02.28.14 at 1:27 pm

Currency Traders ALERT!!!!!!

looks like a double Batman on USDCAD.
——————————–
yeah, ok, but i’m waiting for a triple Batman followed by an inverse Aqua-man, then i’m all in.

#169 Bottoms_Up on 02.28.14 at 1:34 pm

#8 NoName on 02.27.14 at 7:55 pm
——————————————–
The simple fact that ING disclaims it may take 25 days for me to access my funds means I will no longer be putting my money in the orange dudes shorts. Are they crazy?

#170 Old Man on 02.28.14 at 1:44 pm

#164 Bottoms_Up : – The Heinz deal is far from done so no hiring yet. Its just a letter of intent which is like giving a lady an engagement ring for a potential marriage. The key decision date is May 1st, and lots of critical matters have yet to be worked out; maybe yes or maybe no whether the fat lady will ever sing.

#171 Vamanos Pest on 02.28.14 at 1:47 pm

Why did the CMHC need to pre-announce their most inconsequential change in years?

Because it’s so inconsequential that no one would have paid attention without a pre-announcement. It’s politics. The government “protecting the exposure of the taxpayer” without actually doing anything.

#172 airhead princess on 02.28.14 at 1:48 pm

Is our BOC Governor ( Mr Meat Puppet Poloz) a political operator….a moron….incompetent….a bald faced pathological uniformed liar……or something worse?

http://business.financialpost.com/2014/02/28/canada-gdp-surges-2-9-in-final-quarter-blowing-past-expectations/

After beating down the dollar without any proof that what he said had any basis in fact…..we had to speculate that he may be a union operative trying his best to quash competitiveness in the Canadian marketplace.

According to the numbers…..he doesn’t have his nose in the books…a finger on the pulse….an eye on the ball……..his beat down of the dollar was arbitrary and idiotic…..an embarrassment and a big financial loos to all of us. Mr F……please rethink having a union boss head our BOC…..just a suggestion.

#173 chapter 9 on 02.28.14 at 1:51 pm

#85 Mark
Looks like you are not an Albertan. The late 70’s and early 80’s were nothing short of a financial nightmare. Between staggering high interest rates and the Trudeau National Energy Plan the provincial economy was ‘Gutted”. Jingle mail,suicides, failed marriages, the list is endless of the misery those events had on the people in this province.
I know first hand cause I lived it. My clients were mainly oilpatch and I was loosing on average 5 businesses a week due to receivership,lock the doors, or just plain broke. At the same time my mortgage reset at 18.25%. A drop of 10% not even close more like 40 and don’t forget Northlands Bank, Principal Group and Commercial Bank went “broke”.

#174 calgaryPhantom on 02.28.14 at 2:03 pm

Government wants to jack up the house prices and yet every year, take tiny symbolic measures that shows they are trying the opposite.

In the end they want people to be bank slaves, keep working and keep paying tax. And yea, throw in delay citizenship delays too. They want people to remain in canada at any cost and keep working and paying taxes.

#175 Shawn on 02.28.14 at 2:05 pm

CMHC… yawn

First we predict home price decline

Then seeing little or none (and only after years more gains, call for something to make it happen.

Yawn

#176 fixie guy on 02.28.14 at 2:20 pm

#162 Bottoms_Up : “CMHC doesn’t protect the homebuyer, but allows the homebuyer to gain access to funds to buy a home that they otherwise wouldn’t be able to buy because otherwise the banks wouldn’t lend to them.”

Correct and which is, of course, nothing like travel insurance. The massive increase in normally unqualified buyers is also a massive and atypical increase in demand. Price and demand have a strong correlation, especially with inelastic assets. Perfect formula for a bubble in which government protected lenders will profit the most. How this equates to competition for our federal free market hawks is beyond comprehension.

#177 Penny Henny on 02.28.14 at 2:23 pm

G&M says it works out to be about an extra $5/month for the average homebuyer.
BUT, for someone buying a million dollar house the premium might jump to as much as $20 per month.
OH MY!!!!
in other news Canada’s GDP grew by more than US.

#178 Bargains everywhere on 02.28.14 at 2:37 pm

Bitcoin exchange Mt. Gox files for bankruptcy protection after ‘losing’ $473 million.

Shades of Bre-X all over again.

The picture shows Mt. Gox CEO Mark Karpeles bowing in apology in Tokyo but I swear there is a hint of a smirk on his face.

http://online.wsj.com/news/articles/SB10001424052702303801304579410010379087576?mg=reno64-wsj&url=http%3A%2F%2Fonline.wsj.com%2Farticle%2FSB10001424052702303801304579410010379087576.html

#179 Smoking Man on 02.28.14 at 2:41 pm

#168 bdy sktrn on 02.28.14 at 1:27 pmyeah, ok, but i’m waiting for a triple Batman followed by an inverse Aqua-man, then i’m all in.
…..

The inverse is called Camel Toe.

I don’t even know why I bother coming to tax farm.. Up over a million this year on forex alone.

But then, I would start drinking when I get up…

My poor self control and addictions are my strength and weakness.

#180 Dual Citizen In Canada on 02.28.14 at 2:50 pm

What just happened? Did I miss something? Oh well, life goes on….Rent due tomorrow! :-)

#181 bill on 02.28.14 at 2:54 pm

#117 Smoking Man on 02.28.14 at 10:25 am
Sir Harry Flashman V.C. etc – is a guy with a similar to your own outlook on life…

#182 Son of Ponzi on 02.28.14 at 2:57 pm

The $5 announcement is just a ploy to lure the innocent ones into complacency.
Wait for the real shoe to drop.

#183 Same story since 2007 on 02.28.14 at 3:07 pm

#88 Same story indeed on 02.27.14 at 11:48 pm
#77 Same story since 2007 on 02.27.14 at 10:59 pm
Just see the Canadian history , even in the worst interest rate crisis in the 80′s, Alberta dropped only around 10% …

>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
You think saying it makes it true? Check the facts. Calgary’s prices: 100k in ’81, 50k in ’85. That’s 50% drop that will require 100% increase to get back, dude.
It took Calgary until ’06 to get back to 100k. That’s 11 years, if you need help.
>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
No, way… In Edmonton, it was 91K in 1981, it crashed to 75K in 1985, and it was the worst crisis Canada has faced with interest rates around 20%. By 1989 all the losses were erased and it started gaining around 2 to 3 % every year before the boom of 2007.

The current situation is nothing compared to 80’s and there are lots of jobs here. A drop here will be like searching for a $10 dollar coupon on a $2000 dollar couch.
Good Luck

#184 happity on 02.28.14 at 3:07 pm

A non-event event,fodder for the attention deficit.

The real question is what happens to Cmhc when it dawns that as Kerry said, the USA acts like (read already is) a poor country…

#185 Same story since 2007 on 02.28.14 at 3:10 pm

163 Randis on 02.28.14 at 1:09 pm
http://www.theglobeandmail.com/report-on-business/cmhc-to-raise-mortgage-loan-premiums-may-1/article17159342/

Garth I have a question … The article says “… The banks are technically responsible for the premiums, but they are almost always passed on to the buyers …”

Here is the thing, I agree banks should pay the premium because they are the ones who decides to take on the high-risk business. But then for the buyer to be able to take out a mortgage, they have to pay the premium for the banks otherwise the bank won’t lend the money …

My question is, is this considered tied-selling?
>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>

You can try a class action lawsuit, if you think its illegal. Some lawyers might try.

#186 Penny Henny on 02.28.14 at 3:14 pm

Hey Garth.
You’re richer than you think.
http://ucbswww.bank-banque-canada.ca/scripts/query_english.cfm?CiRestriction=Garth%20Turner&CiScope=on

#187 saskatoon on 02.28.14 at 3:15 pm

#158 TOS ATP AT guru

“F” moves make perfect sense.

You are just looking at it the wrong (naive) way.

HE DOESN’T WORK FOR OR REPRESENT YOU.

#188 Ogopogo on 02.28.14 at 3:31 pm

Garth calls it on the money again, much to the rage of realtors and house pumpers everywhere.

On a vaguely related note, it’s funny how my auto spell check wants me to capitalize “realtor”. It goes to show how far these parasites have infected our culture.

#189 JonB on 02.28.14 at 3:36 pm

answer to #163

Tied selling is a bank making approval conditional upon you taking another one of their products (i.e. deposit account)

Customers paying for fees associated with the closing or construction of a house is standars, as is rolling some of these costs into the MTG

#190 Holy Crap Wheres The Tylenol on 02.28.14 at 3:37 pm

$5 per month thats nothing they will take it, but raise their sin tax on smokes and thats a whole differnet ballgame.

#191 Holy Crap Wheres The Tylenol on 02.28.14 at 3:38 pm

#79 Smoking Man on 02.27.14 at 11:20 pm
I would like to extend my thanks to the blog dogs who made me aware of Hunter S Thomson..

____________________________________________

It was probably me as Hunter S is one of my favorites writers of all time. Heres another on for you go and get one of Carlos Castaneda’s books The The Teachings of Don Juan: A Yaqui Way of Knowledge. Peyote plays a large part of his writing. Be prepared to spend an enormous amount of time reading his books, there are quite a few. Also be prepared to travel on Astral plains to different worlds.
http://www.youtube.com/watch?v=dJz2VI_SqoQ

#192 2CntsCdn on 02.28.14 at 3:38 pm

Well that’s pretty well a non issue. That is the gentle-est change against the Cdn housing problem yet. Maybe a bunch of the posters on here are right ….. F won’t poke at Canadians most sacred cow (the home) … until after the election.

Then the cow poking will begin. He has to get the economy off of a false sense of wealth (inflated house prices) …… and back to making and doing stuff … and sustainable jobs that come with that. The economy looks ok on the surface …. but the underpinnings are eroding away.

#193 45north on 02.28.14 at 3:40 pm

eastvan : I know Flaherty personally. He told me that the CONs are going to finance their “tough on crime” agenda by allowing CMHC to insure new privately owned prisons.

sure he wasn’t speaking Russian?

2¢CDN : my business’ bank came along and asked for double the security in 3 weeks … although we had 14 years of strong sales and business results.

thanks for your story

#194 Smartalox on 02.28.14 at 3:42 pm

@ Blaine Monaghan # 156:

you’re exactly right. Call out the press for a few ‘nothing’ announcements, and they won’t show up when you slip something of real substance under the radar.

Also, I’d bet that there was a last-minute change in the content of the announcement: a Friday afternoon press conference is usually an exercise in ‘taking out the trash’ making unpopular announcements at a time when you hope that nobody is watching. It seems out of place to use this opportunity to announce a change of such little consequence.

#195 Aggregator on 02.28.14 at 3:43 pm

No rent price relief for Toronto. Craigslist GTA Average Rental Price Index

GTA Average Rental Offer (YoY%)

1 Bedroom 5.6% ($1,476)
2 Bedroom 9.6% ($2,100)
3 Bedroom 14.1% ($2,356)

GTA Median Rental Offer

1 Bedroom 3.4%
2 Bedroom 12.2%
3 Bedroom 11.1%

Getting ugly out there.

#196 OttawaMike on 02.28.14 at 3:48 pm

#123 Smoking Man on 02.28.14 at 10:56 am

Thanks for the tips Hunter. I’m too scared and incompetent to use Forex but I still made a relatively safe 4% over 5 weeks on the DLR ETF in my TFSA.

I hear you on living in the ‘hood.
Sold out of my estate home 5 years ago and moved to Longbranch’s equivalent in Ottawa.
It’s a real community where people actually talk and look out for each other rather than try to out do each other with stuff.

My biggest regret is wasting 20 years living around those estate assholes.

#197 BCD (D for DMHC) on 02.28.14 at 4:02 pm

#33 late learner on 02.27.14 at 8:47 pm
i am very happy renting. less stress, tfsa, rrsp, resp all maxed out and saving of 1000 dollars a month.
I know my friends are chocked due to morgage payments and other house related expenses. financial matters is putting lots of stress in their relationship–will be providing emotional support to them when their relationship breaks down.
i am really scared. this will hurt lots of near and dear ones.
_________________________________________

Sadist? Much? Sounds more like you want to revel in the pain of others. Not to point fingers at religious zealots–but they love doom scenarios where they see themselves as heroes sweeping in and “helping others”.

#198 Ralph Cramdown on 02.28.14 at 4:19 pm

“My question is, is this considered tied-selling?”

You could call it that, but how can it be illegal if the government mandates it?

Think of it this way: Studies have shown that the #1 predictor of default is how much equity the borrower has. If lots, he’ll sell to get what he can, if little or none, he may just walk. All other things being equal, a rational lender would demand a higher interest rate for a higher LTV loan. Mortgage insurance makes all loans about equally risky no matter the LTV (so everyone ends up paying the same rate if insurance premia aren’t included), and the bank act makes sure banks don’t lend at high ratios without it.

There’s no law saying YOU can’t lend 140% of a home’s value to a mortgagor without insurance, as long as you’re not a bank. And people allergic to insurance costs are welcome to get an 80% first and the remainder as a second mortgage, as it was done in times of yore, and as it shall be done again.

#199 Holy Crap Wheres The Tylenol on 02.28.14 at 4:21 pm

#79 Smoking Man on 02.27.14 at 11:20 pm
I would like to extend my thanks to the blog dogs who made me aware of Hunter S Thomson..

______________________________________________

It was probably me as Hunter S is one of my favorites writers of all time. Heres another on for you go and get one of Carlos Castaneda’s books The The Teachings of Don Juan: A Yaqui Way of Knowledge. Peyote plays a large part of his writing. Be prepared to spend an enormous amount of time reading his books, there are quite a few. Also be prepared to travel on Astral plains to different worlds.

#200 Ralph Cramdown on 02.28.14 at 4:23 pm

#195 OttawaMike — “I’m too scared and incompetent to use Forex”

You mean too smart? FX is a zero sum game including the middle man, negative sum looking at just the bettors. Why not play a positive sum game, like owning part of a company that makes money?

I like those old Smokey tales where he had to go to the can or bet the wrong way due to confusion and lost his ass in minutes. Take the hint.

#201 Old Man on 02.28.14 at 4:29 pm

Some of these real estate deals where the buyer is paying way over the listing or fair market value need to be investigated by the appropriate authorities. I have seen this done before many years ago to hide something, so are these odd transactions taking place on occasion at arm’s length? Maybe not, as have a suspicion something else is afoot.

#202 Smoking Man on 02.28.14 at 4:30 pm

#195 OttawaMike on 02.28.14 at 3:48 pm

Good move, the estate hood sucked, wife Misses the space.

I love it, I was getting Chinese food last night, too low life’s female and a male in there, chic was trying to mooch 40 bucks off the guy.
He said go was broke, then she starts telling him about her Dr visit. Needs a beast reduction and pops off her coat.

What happened next is reserved for a book..

These mix poverty and wealth hoods are awesome.

#203 Smoking Man on 02.28.14 at 4:36 pm

#190 Holy Crap Wheres The Tylenol on 02.28.14 at 3:37 pm

Altho the stamens said on average 5 bucks a month, but when you drill down to the numbers, anyone going with a
minimum down payment is looking at a huge spike in premium. 15% ish head calculation.

Smokers are switching to vapours, electronic cigs, when I’m done my last carton I’m switching . they aren’t bad, just got to get the right level of nicotine..

#204 :):(Ying Yang on 02.28.14 at 4:46 pm

#179 Smoking Man on 02.28.14 at 2:41 pm
#168 bdy sktrn on 02.28.14 at 1:27 pmyeah, ok, but i’m waiting for a triple Batman followed by an inverse Aqua-man, then i’m all in.
…..
The inverse is called Camel Toe.
I don’t even know why I bother coming to tax farm.. Up over a million this year on forex alone.
But then, I would start drinking when I get up…
My poor self control and addictions are my strength and weakness.

……………………………………………………………………….
Smoking Man if you are up over one million in Forex then keep on drinking. Drink heavy my friend then I set you up in Hong Kong we go to the mainland and get you a new liver real cheap. Only $$$ relax then go back to your old habits. That’s the Asian way, the rich get richer and the rich get new body parts when needed.

#205 Aggregator on 02.28.14 at 4:56 pm

Hey Ralph, no inflation eh!

Nearly 500 ways to make a yoga mat sandwich

As few Americans realized until Vani Hari, creator of FoodBabe.com, spotlighted it earlier this month, you’ve probably eaten ADA. This industrial plastics chemical shows up in many commercial baked goods as a “dough conditioner” that renders large batches of dough easier to handle and makes the finished products puffier and tough enough to withstand shipping and storage. According to the new EWG Food Database of ingredients in 80,000 foods, now under development, ADA turns up in nearly 500 items and in more than 130 brands of bread, bread stuffing and snacks, including many advertised as “healthy.”

Shoe Rubber Chemical Removed From Subway Bread Found In Nearly 500 Common Foods

Just another example of how far corporations are willing to go to make profit and how inflation is running much higher then the incestuous StatsCan says every month. And if you think this is bad, it's going to get worse. So you all better watch what you're eating and feeding your kids cause quite frankly, the government and corporations don't give a rats ass about your health.

#206 Penny Henny on 02.28.14 at 5:08 pm

this will get the gold bugs going.
http://business.financialpost.com/2014/02/28/london-gold-fix-study-indicates-decade-of-bank-manipulation/

#207 Blacksheep on 02.28.14 at 5:22 pm

How many times have you read “This isn’t going to end well”?

Well I’ve concluded, it is going to ‘most likely’ end, the way the pricks pulling the god damned levers, want it to end.

Does Harper and the F’ster want housing to correct? When the next election?

This is really getting old. Time for change.

#208 Ralph Cramdown on 02.28.14 at 5:33 pm

#204 Aggregator — “Hey Ralph, no inflation eh! Nearly 500 ways to make a yoga mat sandwich”

Yeah, I heard about that, Agg, and it really bothered me. No facts were presented as to whether the stuff is harmless/harmful/untested. It was just a gross-out association with items which, because they absorb human sweat (and stink) or are in direct contact with dirty sidewalks, are rightly considered dirty and inedible. Is the chemical safe or unsafe? Who knows, but think of stinky yoga mats and running shoes that have been through dog shit!

Scottish verdict: UNPROVEN!

#209 Vancouver RE agent. on 02.28.14 at 5:34 pm

Vancouver condos have no other place to go but UP UP UP and then some more UP. All the market analysts agree that prices for RE in Vancouver area will go up by by at least 25% in the next 5 years.

#210 jan on 02.28.14 at 5:39 pm

CMHC said the new rules will apply to owner-occupied units and one-to-four-unit rental properties. It will also apply to self-employed owners.

Huh
I can use cmhc for up to 4 rental properties as well ???????????????

#211 Weasels Ripped My Flesh on 02.28.14 at 5:44 pm

#185 Same story since 2007 on 02.28.14 at 3:10 pm

163 Randis on 02.28.14 at 1:09 pm
http://www.theglobeandmail.com/report-on-business/cmhc-to-raise-mortgage-loan-premiums-may-1/article17159342/

Garth I have a question … The article says “… The banks are technically responsible for the premiums, but they are almost always passed on to the buyers …”

Here is the thing, I agree banks should pay the premium because they are the ones who decides to take on the high-risk business. But then for the buyer to be able to take out a mortgage, they have to pay the premium for the banks otherwise the bank won’t lend the money …

My question is, is this considered tied-selling?

—-

As long as they can keep you asking the wrong questions they don’t have to worry about the answers.
The right question is :

Is there any risk to the lender when it’s a collateral loan (secured mortgage)?

Why don’t you try and answer that? I’ve asked it here before and no one even tries to answer.

Not even the lame ass: “Banks are too big and important to be able to hassle themselves trying to sell houses”

Banks entered the transaction with nothing. The ‘loan’ was data entry. If the buyer is a dead beat, the bank has a house to sell.

#212 jess on 02.28.14 at 5:45 pm

Swiss bankers say tax evasion was ‘a business model’
Banking group hits out at Credit Suisse chief executive after he tells US that alleged tax schemes were due to a few dishonest employees

…More than 22,000 Americans were using Credit Suisse to park combined assets of $12bn at one time, according to a report released by the US Senate ahead of Wednesday’s hearings.

…”The Senate subcommittee alleged Credit Suisse bankers held secret meetings in luxury hotels and used hidden elevators to help foreign clients hide their wealth, a practice that one senator said belonged in a spy novel, not a bank. ”
http://www.telegraph.co.uk/finance/newsbysector/banksandfinance/10665743/Swiss-bankers-say-tax-evasion-was-a-business-model.html

http://www.taxjustice.net/2014/02/27/credit-suisse-scandal-echoes-big-jail/

#213 Old Man on 02.28.14 at 5:46 pm

#204 Aggregator – The next time you buy food at the grocery store for $100.00 keep in mind that about 80% on average or $80.00 was just spent on moisture content or water. Now there are only two foods in the world that have everything to sustain life; one is pure honey from a beekeeper and the other is hemp seeds.
Water is essential above all, so this is my hypothetical diet for you, so enjoy while I pig out on a pizza. :)

#214 Paul on 02.28.14 at 5:47 pm

#188 Ogopogo on 02.28.14 at 3:31 pm

Garth calls it on the money again, much to the rage of realtors and house pumpers everywhere.

On a vaguely related note, it’s funny how my auto spell check wants me to capitalize “realtor”. It goes to show how far these parasites have infected our culture
———————————————————-

#215 Smoking Man on 02.28.14 at 5:47 pm

#203 :):(Ying Yang on 02.28.14 at 4:46 pm

Picking tops and bottoms is easy, I showed you all how to do it. Historically in the archives on here is documented proof.

It takes testosterone, men in pink shirts with man purses need not apply.

It also takes a bit of insanity to put the bets on that I do.

Fibonatchi, Boulanger bans, bla, bla, bla…..

Fear and greed, so obvious I am batman and camel toe..

Seneca tomorrow night… :)

#216 Paul on 02.28.14 at 5:48 pm

#188 Ogopogo on 02.28.14 at 3:31 pm

Garth calls it on the money again, much to the rage of realtors and house pumpers everywhere.

On a vaguely related note, it’s funny how my auto spell check wants me to capitalize “realtor”. It goes to show how far these parasites have infected our culture
———————————————————-
YOU HAVE CULTURE

#217 4 AM Sunrise on 02.28.14 at 5:52 pm

#186 Penny Henny on 02.28.14 at 3:14 pm

Hey Garth, Bandit says he wants a new chew toy and some treats for $33.70. When he’s not being a selfish chow chow, he actually wants you to donate it to the SPCA so less fortunate dogs can have treats and toys.

So grab your money out of F’s (Poloz’s?) grubby elfin claws and post a picture of the cheque to this page!

#218 jan on 02.28.14 at 5:58 pm

#210 Weasels Ripped My Flesh on 02.28.14 at 5:44 pm
#185 Same story since 2007 on 02.28.14 at 3:10 pm

163 Randis on 02.28.14 at 1:09 pm
http://www.theglobeandmail.com/report-on-business/cmhc-to-raise-mortgage-loan-premiums-may-1/article17159342/

Garth I have a question … The article says “… The banks are technically responsible for the premiums, but they are almost always passed on to the buyers …”

Here is the thing, I agree banks should pay the premium because they are the ones who decides to take on the high-risk business. But then for the buyer to be able to take out a mortgage, they have to pay the premium for the banks otherwise the bank won’t lend the money …

My question is, is this considered tied-selling?

—-

As long as they can keep you asking the wrong questions they don’t have to worry about the answers.
The right question is :

Is there any risk to the lender when it’s a collateral loan (secured mortgage)?

Why don’t you try and answer that? I’ve asked it here before and no one even tries to answer.

Not even the lame ass: “Banks are too big and important to be able to hassle themselves trying to sell houses”

Banks entered the transaction with nothing. The ‘loan’ was data entry. If the buyer is a dead beat, the bank has a house to sell.

What part of commie country Canaduh do you not understand sir ?????

#219 TakingResponsibility on 02.28.14 at 6:05 pm

Re: The Big Announcement. ditto the pfffft.

Aha – a new selling ‘Point’ for the first timers? Buy Before May 1st – before premiums go Up!

PS. Anyone else wondering what the H this crown corp is thinking by coming out with a “public announcement?” Geesh. Only big headed CMHC.

#220 4 AM Sunrise on 02.28.14 at 6:06 pm

#186 Penny Henny on 02.28.14 at 3:14 pm

And on that note, Justin Bieber is also richer than he thinks.

#221 DR on 02.28.14 at 6:07 pm

200 Old Man on 02.28.14 at 4:29 pm
Some of these real estate deals where the buyer is paying way over the listing or fair market value need to be investigated by the appropriate authorities. I have seen this done before many years ago to hide something, so are these odd transactions taking place on occasion at arm’s length? Maybe not, as have a suspicion something else is afoot.

Good point Old Man. Don’t ask me why.

I thought that about five years ago and it hasn’t stopped. I could have bought a detached in Leaside for 550K two storey. True story. it was early 09.

Yesterday……Estate sale listed in Cabbagetown. listed 665K
sold for 872 THOUSAND

Needed everything replaced. It was not renovated. Its not worth 800 anything thousand.
The kicker. no parking….like what is wrong with people?????
I thought that myself something has to be behind the scenes there.
This happens every day in Toronto though.
I picked up quite a few “deals” past few years and the way prices are today I could only hope to find the same prices I paid. But it isn’t easy.

there is hardly any way to buy a property now in the area south of bloor . Roncesvalles to Beaches.

#222 OttawaMike on 02.28.14 at 6:10 pm

Ralph and Aggregator:

Yeah, it is really inconclusive but I still use the scare story to get my kids to stop buying Subway.

Those places have always made me hold my breath as I walk by them and another name for the poor “sandwich artistes” who work there are SubHumans.

http://www.businessweek.com/articles/2014-02-27/how-a-rubber-chemical-found-its-way-into-500-food-products

#223 4 AM Sunrise on 02.28.14 at 6:12 pm

#204 Aggregator on 02.28.14 at 4:56 pm
Hey Ralph, no inflation eh!

Nearly 500 ways to make a yoga mat sandwich
————————————————–

There’s “dough conditioner” in those hot, fluffy $0.97 “French” bread loaves at Loblaws, too. I don’t remember if it’s ADA exactly. Reading the ingredients list on those loaves always made me nervous, but my mom asked me to buy one on the way home anyway because “they’re sooooo good”.

#224 bdy sktrn on 02.28.14 at 6:44 pm

east van RE continues to’skyrocket’. this is a non hammy area but i’m starting to wonder.

this is a duplex, on one of the busiest 4lanes in the city (1st ave), only a few of my armspans from the front door to the traffic, as it climbs a hill, engines roaring.

yesterday i looked on mls and there were no pics and it was listed as sfh for 999k. I thought it seems quite wellbuilt and large for only 999 despite it’s very poor location, although within a quite hot larger area. i though i remembered it was a duplex having passed it many times.

just came back from a run and went by, snooped, it’s a duplex, v large and well done, nearing completion (maybe one month left). nice bldg. bring industrial hearing protection.

and guess what happened even before the pics get up on mls, yes, it sold. one side left. a cool mil to live in a not nice spot.

i mentioned to a friend (ex-realtor) who would pay to live on such a busy street? he said the people buying these come from places where it would be considered tranquil.

http://beta.realtor.ca/propertyDetails.aspx?PropertyId=14094023

#225 jan on 02.28.14 at 6:47 pm

So mister Turner, how’s that hedge-fund shorting our real estate doing so far.
My guess is you will never answer this !!!!

Ask the fund. BTW it is not shorting real estate, but I’m sure has cleaned up on the dollar. — Garth

#226 Chopper on 02.28.14 at 6:59 pm

You guys are famous, this site was mentioned on the evening news today on CBC, and a few posts were mentioned regarding the CMHC announcement.

The CBC reporter was saying the increase in premium is negligable and will have no impact on the RE market and it is still a good time to buy.

Which RE cartel is paying the CBC to carry these misleading reports?, they paint a rosy picture about the RE environment in Canada when the opposite is true.

I can truly say I have learned not to believe or trust anything you hear on TV, you must do your homework on any financial matters as you will be lied to.

I am so glad I found this website, thanks Garth for your work here.

#227 Rational Optimist on 02.28.14 at 7:01 pm

Ralph Cramdown is the 1%…of English speakers who pluralize “premium” as “premia,” that is.

#228 Derek R on 02.28.14 at 7:23 pm

#207 Ralph Cramdown on 02.28.14 at 5:33 pm wrote:
Yeah, I heard about that, Agg, and it really bothered me. No facts were presented as to whether the stuff is harmless/harmful/untested.

Bothered me too. So I did a bit of research and found out enough to say that it’s probably harmless because of the following…

1) During baking, azodicarbamide (AZD) almost entirely breaks down to biurea (harmless), and traces of semicarbazide (weakly carcinogenic in large doses) and ethyl carbamate (carcinogenic but naturally occurring in beer, wine, whisky, soy sauce, etc.)
2) It can cause asthmatic reactions if breathed in but there is no evidence that this happens when it is eaten.

So baked bread probably doesn’t pose much of a risk. No more than alcoholic drinks anyway. AZD is banned as a food additive in Europe, the UK, Australia, and NZ, But it’s been done there Just In Case, I would say.

If you still don’t want to eat AZD, just check the ingredients list on the packaging. It’s listed and not all bakery goods use it. So you can choose to buy bread that’s AZD-free.

Hope this puts a relatively tiny risk into perspective.

#229 bdy sktrn on 02.28.14 at 7:40 pm

more on this one http://beta.realtor.ca/propertyDetails.aspx?PropertyId=14094023

not only does it set a new high water mark it crushes it.

around here at the heights of the 2013 market a top shelf duplex unit , new, would fetch 800-875. poorly built ones for 675. this on a quiet street. subtract 100-150k for being in traffic noise hell. so maybe 750 for a nice one on busy street. this is top of the range seen in this area.

2013 – 750k
2014 – 999k

that’s up 33% over one year .

thanks china for making us locals rich.