What could go wrong?

WRONG modified

Five years ago Ricky and Carmen came to Canada for a better life. That led to graduate studies, two so-so jobs, two kids, a new SUV and a two-bedroom apartment in Burlington. But it’s not enough. This is the land of entitlement, after all.

“So we are today renting a 30 yr old apartment, with no washer, dryer or dish washer,” Carmen writes me. “Paying $1300 per month. Our annual income together is $115000, but take home is $6k per month for both of us. We have a car loan for $8000 and no other debts. We have 20k in RRSP and 5K in TFSA and contribute $300 for our 2 sons (5 years, 8 months) towards RESP.”

Not a bad start on the new life, with debt under control and almost twenty grand in liquid assets. But Carmen’s house-horny.

“So now I am having hard time staying in apartment with 2 kids, and no washer/dryer means 3 hrs of  weekend time for using downstairs laundry. We thought of moving for rent as my husband is following your advise of not buying home now. But when we started searching rental homes anywhere in GTA, house rent for 3 BR townhouse or condo is no less than 1700, plus utilities..which all together will come for $2000 per month.

“So my question: would it not be ok to buy a semi home around 420K with 5% down so that our monthly mortgage will come around $2300 or so. Is it better to rent for 2000 or buy anything with monthly mortgage as $2300?”

Well, Carmen, do the math. A $420,000 house will take every last cent of your liquid assets to buy, and you still won’t have enough for the CMHC premium ($10,972) or the land transfer tax ($2,875, after the first-timer rebate). And even if you do manage to close the deal and add the insurance bill to the mortgage, your monthly (loan plus property tax and insurance) will be more than $2,500 – plus those utilities. In other words, almost a thousand-dollar premium over renting.

Is it affordable? Technically, yes. You qualify, because there’s nobody in the system – not the realtor, or the banker or the broker – tasked with looking out for your interests. We have lost our way, Carmen, when a young family with more equity in their vehicle than money in the bank can move into a $420,000 house, with a $410,000 mortgage. The moral compass around here is broken.

By the way, a portable, washer-dryer all-in-one appliance which is ventless and requires only a kitchen faucet to operate can be purchased for $900. There. I just saved you $432,937.

Of course Carmen is nuts to roll the dice and risk everything on a crummy suburban semi for larger reasons, too. Despite the assertions of the house-humpers, Re/Max, the real estate cartel and everyone in Calgary, the Canadian real estate market is not in good shape. Yesterday’s pathetic post showed even in mighty Toronto, home of hormonal hipsters and media-pleasing bidding wars, more houses are selling for below ask than above. Sales volumes have decreased steadily since 2012 and big segments of the market (like properties over a million) are languishing.

There are also places, like Halifax, where a two-year supply of houses is piling up weekly, with sales off 35% and prices starting to tank. A nation away, Victoria house sales are running way below the five-year average and prices are flatlining. In the middle, Ottawa’s condo market is in serious shape while overall sales and prices have hit a wall. Nationally, Teranet reports that March was the first such month in 15 years that housing values stalled.

Now, there’s Adrienne Warren.

The Scotiabank economist shared a stage with me a couple of years ago in a Toronto hotel as we debated the housing market. She said the fundamentals were good. I said we were headed down the wrong road. Today it sure sounds like she agrees with me.

The bank’s latest real estate report, released Wednesday, pulls few punches.

“Canada’s long housing cycle is turning,” says Adrienne. “Residential investment stalled last year as affordability constraints tempered home sales, and builders scaled back the number of new developments… The impact of a softening housing market will be felt broadly. The likelihood of smaller household wealth gains as house price growth slows — or adjusts lower — will reinforce a more cautious trend in consumer spending.”

The key points are simple. The housing boom’s ending and as it does, we all take a hit. For the last dozen years the real estate sector has expanded at twice the rate of the economy (I’ve shown you graphs comparing the FIRE sector here to that in the US). There are now almost 500,000 people employed in building, flogging or financing homes. Hell, there are 40,000 agents in the GTA alone, almost three-quarters of whom didn’t make a sale last month.

Adrienne says you can blame a combination of things, like inevitably rising mortgage rates, stricter mortgage regs and (above all) prices which have mushroomed past the ability of people to pay – and still have a life. Folks like Carmen and Ricardo. Just imagine if they threw everything they had into buying a place that cost them far more than rent, only to have it decline in value and wipe that meagre wealth away. What a personal tragedy.

With listings tight and money cheap, there are many who come here to celebrate rising prices, claiming everything’s cool. But a market with thinning volumes and ever-rising mortgages which sucks in the naïve and the vulnerable provides a classic definition of risk.

How is that not obvious?

224 comments ↓

#1 Sider on 04.16.14 at 8:21 pm

Say goodbye to the Canadian economy. Goodbye stable currency. For all the fawning over F, he knew this was coming.

His heart just wasn’t in it for the long run.

I confronted Jim one time at the Jays game in 2012. Needless to say, he wasn’t pleased to hear the truth of what was really happening to the Canadian economy.

The CHMC will go bankrupt, a fact Jim knows and did not want to face.

#2 Jimmy on 04.16.14 at 8:21 pm

Would any of the readers be able to help me win a bet?

I need you to show me a good example of “re-listing” of a home in Calgary? Preferably the SW. You know, the trick realterds play to keep the listing fresh and DOM low.

Many thanks.
Cheers!

#3 Andrew Woburn on 04.16.14 at 8:25 pm

Rumours of a Chinese crash are greatly exaggerated: South China Morning Post

http://www.scmp.com/comment/article/1483880/rumours-chinese-crash-are-greatly-exaggerated

#4 Andrew Woburn on 04.16.14 at 8:26 pm

Under new rules, rich Chinese should learn French if they want to move to Canada: South China Morning Post

http://www.scmp.com/comment/blogs/article/1483670/under-new-rules-rich-chinese-should-learn-french-if-they-want-move

#5 Smoking Man on 04.16.14 at 8:27 pm

Who the hell are we?

As I slowly morph into a character of my imagination, I don’t know who the real me is anymore.. The mild mannered code smith, the loving husband and father, the short term rental addict. The drunk, the raving loony Smoking Man.

On other blogs I play a female lesbo man hater, named Ashita Aurora.. On an other constable Smith. Smokey and greater fool is my favorite.

What does I, Me, We even mean…. I don’t know.

They say a good writer is somewhat insane.. No that’s not right.

It’s the writing that causes insanity. You need to zone out, you need to listen to voices inside your head. Multiple characters, and it gets complicated.

BIG Brother,
got news for you, the guys in the Suv, don’t wear suits. Taseled shoes, Polo shirts and Docker slacks.. When they make contact with you it doesn’t take them more that 5 min into the talk before they try and extract your political views. To impatient if you ask me. Favorite question, hey what do you think of Ron Paul?.

The last guy to try that on me, it took me no more than 30 minute’s to free him. I reached down into his soul, grabbed his belief system by the jugular it was dead before I had it out of its body.

He now wonders the streets homeless. People need a god, an authority figure of some kind to fear loath or worship something, with out it.. Animal is all I’m saying

Left alone most mortals can’t handle it..

A massive ego is freedom..

#6 Debt's Dark Embrace on 04.16.14 at 8:30 pm

This is the new normal. Interest rates will not rise to “historical norms” cuz the world will go bankrupt.
How is that not obvious ?

#7 Paolo on 04.16.14 at 8:31 pm

Is the train wreck finally here?

After 12, even 15, years of nonsense?

If a bank economist is willing to admit this the reality will be much, much worse.

Back around 2004 I would say to people “If this keeps up then a SFH in the GTA will be a million dollars!”

Yes, I’m not far off.

Who would of thunk that so much would be put towards this ‘ponzi’ (including that infamous 40 year amortization Flaherty helped along), which would keep it going for so many years!

Now it’s hipsters that are being pulled in.

Is 2014 finally the turning point?

#8 Aggregator on 04.16.14 at 8:31 pm

For the last dozen years the real estate sector has expanded at twice the rate of the economy (I’ve shown you graphs comparing the FIRE sector here to that in the US).

Wondering what's driven job growth in Toronto? Financial debt

Insurers, realtors, brokers, credit services, wealth management, traders, speculators, lawyers, analysts, economists, etc. We've pumped up sub-industries based on nothing more then adding numbers into a computer (printing) and liabilities on to balance sheets, which is why if CBs stop running their printing presses, it's game over for newly created jobs in financial capital cities. CBs know that.

What we're seeing is like Gresham's Law, but instead of bad money driving out good money, it is bad jobs driving out good jobs. We're this all leads to is deeper into the abyss.

#9 Smoking Man on 04.16.14 at 8:35 pm

How is that not obvious?-Garth

That’s just it old boy, come to Union station one time and I will clearly demonstrate for you old boy, the masses oblivious to the obvious..

#10 Waterloo Resident on 04.16.14 at 8:37 pm

For people who say “Go to Alberta for work”, here is proof that Canada does not have a shortage of workers:

http://www.afl.org/index.php/Press-Release/pbo-debunks-worker-shortage-myth.html

Quote: “Exposes bogus rationale for TFW program

Edmonton – There is no significant shortage of workers or skills in Canada, according to a new report from the Parliamentary Budget Officer (PBO). …… “Lies and exaggerations about the existence of a labour shortage have been used to justify the massive expansion of the Temporary Foreign Worker program (TFWP),” Alberta Federation of Labour president Gil McGowan said. “Public policy should be based on facts. If you ignore the facts, you get bad policy that hurts the public interest. That’s what we have with the Harper Government’s Temporary Foreign Worker program.”

#11 Observer on 04.16.14 at 8:39 pm

One of my uncles used to say that any relationship is like a rubber band; so long as there is enough give and take, it will last, but once the parties pull to hard, the relationship becomes over stretched and will eventually break.
Looks like the average Canadian’s relationship is just about at breaking point. When house “owners” tell you that they are having trouble making payments on credit cards, when gas prices are near record prices, when natural gas and hydro prices are set to rise, you know that people are str-etch-ed beyond their limits.
Things are really going to get nasty,

#12 Mac Marketing remember us? on 04.16.14 at 8:40 pm

I’m not sure if anyone remembers this marketing fiasco:

http://bc.ctvnews.ca/condo-marketing-company-admits-it-duped-media-1.1157243

Well its finally coming up for judgement in BC and the Real Estate Council of BC usually are pretty lenient on the perpetrators.

If your from BC and want to put your two pennies, eh nickles in write to RECBC at: [email protected]

And don’t forget to write BC’s Minister of Finance, because that’s where the buck stops for RE in BC.

His email address is: [email protected]

Let them know what you think of this company…I have, just my thoughts

#13 Observer on 04.16.14 at 8:40 pm

S/b relationship with the housing market.

#14 OttawaMike on 04.16.14 at 8:43 pm

An Interesting piece from the Economist that tells how the business of govt. guaranteed mortgages skews real estate in a bad way:
http://www.economist.com/news/finance-and-economics/21600730-americas-huge-mortgage-market-distortions-seem-likely-endure-ugly-twins

Just remove FMIC and replace it with CMHC to apply to Canada.

#15 hohoho on 04.16.14 at 8:46 pm

> … The CHMC will go bankrupt …

doesn’t CMHC go after you to recover their payout to the banks? so the premium is not really an insurance premium, but an admin fee for their loan … ie. assets in their books that can potentially be monetized

#16 sideline sitter on 04.16.14 at 8:46 pm

Save at least 20% and then look for a house, Adrienne… don’t risk it all. rent a bigger space. And you’ll scratch that itch!

#17 DJG on 04.16.14 at 8:47 pm

I don’t think it’s true that properties over $1 million are “languishing” as you put it. Here are some examples from the last few days:

52 Birch, a semi- with no parking in my hood just sold for $1.54 ($240k over asking) in seven days.

6 Parklea sold for $1.202 ($133k over asking) in six days.

123 Welland sold for $1.375 ($176k over asking) in six days.

1 Parkview sold for $1.355 ($116k over asking) in seven days.

70 Summerhill Gardens sold for asking, but asking was $1.479 for a two-bedroom row house with no parking on a 14-foot lot.

You can debate all you like whether these buyers are foolish, but from what I can see, these aren’t even outliers. The majority of houses in the stats I looked at (South of Eglinton, East or West of Yonge) in the $1 million+ range were selling quickly at asking or above.

#18 Bottoms_Up on 04.16.14 at 8:50 pm

Carmen, move to Hamilton.

Nice clean 3 bedroom townhouse in a decent area, $250k:

http://beta.realtor.ca/propertyDetails.aspx?PropertyId=14277184

#19 hohoho on 04.16.14 at 8:54 pm

> … Interest rates will not rise to “historical norms” cuz the world will go bankrupt …

interest rate will rise when sufficient debt has been rolled over at low rates and the budget become balanced …

#20 Bottoms_Up on 04.16.14 at 8:54 pm

Car sales must be hurting.

In the past two weeks, here’s what I’ve heard from 3 or 4 different companies:

– 0% financing 60 months.

– dealer invoice pricing, lowest prices ever.

– prices rolled back 15 years.

– lowest absolute prices, no negotiation needed, will be hung in the car windows this weekend. browse prices on friday, come in and buy on saturday!

#21 Freedom First on 04.16.14 at 8:55 pm

When the Bank RE pushers start getting on side with this blog about the state of the Canadian housing market and its broad economic impact for everyone, well, I for one take it as a sign that Carmen should practice some patience right now. Her and hubby have worked hard at becoming well situated in Canada in only 5 years. Life is not a hundred yard dash, same as having a $500,000 mortgage is not a goal for a sane person to ever strive for. I would always rather have $500,000 in 10 different diversified liquid and balanced assets as well as being debt free. Re only if it meets Garth rule of 90. Call me crazy.

#22 OttawaMike on 04.16.14 at 8:58 pm

#103 Castaway on 04.16.14 at 9:48 am

Or the bearish call on the Canadian dollar. SM and other financial wizards were all gonna go short 2 months ago cause it was going to $0.60 remember. How did that short work out for all you experts?
_________________________________

Thanks for asking.
I was in and out of DLR over 5 1/2 weeks with $20 k from my TSFA. Made 3.9%. Not bad.

#23 Joe on 04.16.14 at 8:59 pm

I don’t see prices in Toronto coming down anytime soon….
Because of inflation the home buyers are winners anyway… and with inflation government is sponsoring and make payments easy with worthless dollar,
So there is still big incentive to buy a house knowing of inflation….isn’t that right?

#24 Exurban on 04.16.14 at 8:59 pm

#10 Waterloo Resident

I’m not a big fan of union rhetoric, but their complaints about the so-called Temporary Foreign Workers program are 100% correct.

BTW I’ve noticed that the unions speaking out on this issue are primarily private-sector-based.

#25 LB on 04.16.14 at 9:02 pm

House here in North York was listed for $899,000 February 25th. Yesterday, April 15th, it was re-listed for $749,000. Is this a sign of the times or are home owners/realtors trying to milk buyers? You be the judge.

#26 Smoking Man on 04.16.14 at 9:06 pm

This may not end well for me in a few minutes, the screen, Seneca Casino… 300 lbs mammoth woman not playing on the gold fish slot.. Her hubby a short built uni-brow, mad at the world type x con serial killer.

My wife, an old school Scottish
phyco into her 4 th wine, who made orgasmic sounds when the highlander was choking heads wants the seat, asks can I play.

The hippo looks like she’s about to to fire a chewing Tabaco spit ball at her.

The serial killer looks me right in the eyes, his are black and serious attempts to telepathically
tell me to f-off

I just visualize that I’m 20 years old again, on my old hockey team, I puff my chest hard, hoping he don’t notice my man boobs.

It worked….. Thank God.. Would have gotten my ass kicked..

#27 Nemesis on 04.16.14 at 9:13 pm

#WhatCouldPossiblyGoWrong!? #TalladegaNights #CougarInTheCar #TigerIntTheTanK?NoEgoIsFreedom

http://youtu.be/OYIKdQcqbjI

#28 Waterloo Resident on 04.16.14 at 9:14 pm

to #6 (Debt’s Dark Embrace)
Quote: (((“This is the new normal. Interest rates will not rise to “historical norms” cuz the world will go bankrupt.
How is that not obvious ?”)))

My answer:
The reason WHY interest rates will go up is precisely because the world is already bankrupt. When you loan money to someone who is broke, you want to get a higher premium for the risk you are taking, that is why you charge such a high rate.

America is broke, and once the world goes off the U.S. as the world’s reserve currency then interest rates will head up, way-way up, and so will Canadian rates too.

#29 Nemesis on 04.16.14 at 9:16 pm

#SmokingManPhilosophyAddendum

http://en.wikipedia.org/wiki/Bushido

#30 arjosoer on 04.16.14 at 9:22 pm

To Jimmy

Would any of the readers be able to help me win a bet?

Search google for the address and use the google cache to look at old entries from real estate websites

#31 Smoking Man on 04.16.14 at 9:25 pm

#22 OttawaMike on 04.16.14 at 8:58 pm

Don’t ask me about markets anymore, something has happened to me… The part of my brain, the communication engine to the UCC is being deprived of oxygen as the writer side is taken
over.

This is a new road for me, hell I gave you bastards about 5 years of near perfect pics..

Stop complaining….

#32 Jas Girn on 04.16.14 at 9:28 pm

I hope Smoking Man fades for a day. So annoying. Garth must be really annoyed by this buffoon.

#33 Tiger on 04.16.14 at 9:29 pm

Sm ,funny how you don’t talk re on this blog!
You only talk bull shit, hey I’ve got some re for ya, it’s an old septic tank and you can buy it for 100 dollars,you can save money this way creating more savings per , and do more drugs per, now that would help out in creating your new book, and save money by owning, just think yes I’m no long a basement dweller any more.
Wait till I start blogging Tom, I’ll show them :-)

#34 Shawn on 04.16.14 at 9:30 pm

Waiting to meet Waterloo

Waterloo at 28 said:

America is broke, and once the world goes off the U.S. as the world’s reserve currency then interest rates will head up, way-way up, and so will Canadian rates too.

****************************************
America is broke? That’s so 2009 and 2011. America’s deficit is plummeting. Debt is rising only slowly and falling in relation to GDP.

America is rich and far from broke.

One man’s debt is another man’s savings. Some will say that a bank can create deposits, but they don’t own the deposits. Deposits are liabilities to depositors.

Most every bank has more deposits than loans.

In 2009 doomers said American Banks were broke.

I bought Wells Fargo around $10 (and then bought more later at higher prices) Now it’s $49.

Bank of America got under $6 and now it’s around $16. I own some. Bought at 9, watched it fall to 6 but hung on.

I gorged on Toll Brothers (home builder) in the low 20’s and now its about $34.

Made money also on Berkshire Hathaway and Wal-Mart.

Bet against America at your peril.

How could a government that has the power to tax a rich economy go broke?

#35 T.O. Bubble Boy on 04.16.14 at 9:35 pm

TRUE STORY: Mississauga realtor came to the door tonight (yonge&lawrence area)… said she had clients in Mississauga looking to buy in the area… I said “look down the street, there are houses for sale at $1.8M and $1.3M”… she said “no, they only have $1M”.

CMHC – stop the insanity!!!

#36 Nemesis on 04.16.14 at 9:36 pm

#YouAreHereToLearnTheMysteriesOfKungFuNotLinguistics #JapaneseFatHeads

http://youtu.be/fCbf4DjlHuM

#37 X on 04.16.14 at 9:38 pm

Great example above of why we should go back to 10% down to buy a property. Then people who have no money, but think they do, will not get foolish ideas.

#38 Smoking Man on 04.16.14 at 9:41 pm

OK garth that’s it for tonight, rapidly approaching the dark side.

You know what to do……..

I will check in from NYC at my buddy’s movie premiere.. F hope it’s good.. Got a few Passos in it.

If not, I’ll feel bad, I talked the prick into leaving he’s slavery to Chase his dream……

#39 NS in Calgary on 04.16.14 at 9:42 pm

#10 Waterloo Resident on 04.16.14 at 8:37 pm

I think that you are mistaken. I manage a small business in Calgary and we have 3 open positions for over 6 months. The only people applying are newcomers to the city (without experience) or foreign students graduating from colleges in Ontario. Meanwhile we have to defend from headhunters and competitors poaching the current staff. Our clients are having the same experience.

#40 Old Man on 04.16.14 at 9:52 pm

Smoking Man who hooped the $3.1 billion in 2013 which was in the anti-terror program that nobody can find? Caesar and his gang of thieves don’t know, as it went poof off the books to parts unknown.

#41 Obvious Truth on 04.16.14 at 9:52 pm

#23.

Very few things are linearly related in such an easy manner. If they were we would all be very wealthy.

And always remember that houses cost money and you are on the side of the leveraged. It’s a momentum trade. I hate investing with them for more than a fortnight into or out of earnings. Except for FB. Zuckerberg is genius IMO. But I’m in way lower and for a long time. I want my own personal drone. This young crop of tech guys is going to amaze us.

Inflation may not work out the way you think. Even though i think it’s coming.

#42 jan on 04.16.14 at 9:53 pm

#27 Nemesis on 04.16.14 at 9:13 pm
#WhatCouldPossiblyGoWrong!? #TalladegaNights #CougarInTheCar #TigerIntTheTanK?NoEgoIsFreedom

http://youtu.be/OYIKdQcqbjI

STOP THIS CRAZY NONSENSE !!!

#43 Mr. Frugal on 04.16.14 at 9:57 pm

I think it’s pretty typical for young people to end up with all of their eggs in one basket – housing. The problem is that you need to get out of this situation as quickly as possible. When interest rates were high and houses were cheaper, you could work to pay down the debt and build equity quickly. But, now that houses are so expensive, young people simply cannot pay down the debt in a reasonable time frame. The bottom line is that most will run out of time to save for retirement. Like it or not there are only two options; (1) rent (2) move to an area where houses are cheaper and commute.

#44 DZ on 04.16.14 at 9:59 pm

What is this magic laundry machine you speak of, Garth? I need it!

#45 World According To Garth on 04.16.14 at 10:03 pm

Great picture tonight.

Have a friend who moved to Kelowna on a job offer. He says it’s beautiful there compared to the moldy, clogged dingy wet coast. He also said RE is collapsing. 450k houses selling for $275K

He also said its devoid of big govt and HAM unlike the lower wetland with its multiple muni workers plus loads and loads of prov/federal govt workers and their buildings full of pencil pushers. Imagine that. Why are homes so expensive on the west coast again? Oh….our other friend? His ex wife at ICBC makes $120K pushing paper. ICBC head offices are in the lower mainland. Similar private sector worker makes about 45k a year. Your taxes at work……

#46 Mark on 04.16.14 at 10:09 pm

“I think that you are mistaken. I manage a small business in Calgary and we have 3 open positions for over 6 months. The only people applying are newcomers to the city (without experience) or foreign students graduating from colleges in Ontario. Meanwhile we have to defend from headhunters and competitors poaching the current staff. Our clients are having the same experience.”

That’s not what I’m seeing in Calgary. Jobs are few and far between, except in the low-end service sector which barely pays enough to cover rent.

#47 45north on 04.16.14 at 10:11 pm

Folks like Carmen and Ricardo. Just imagine if they threw everything they had into buying a place that cost them far more than rent, only to have it decline in value and wipe that meagre wealth away. What a personal tragedy.

it would be

Paolo : If a bank economist is willing to admit this the reality will be much, much worse.

yep

#48 economictsunami on 04.16.14 at 10:14 pm

Financial engineering by western governments/CB’s, with seemingly endless credit, with misplaced incentives for too long a period. Now where have we seen this before?

Get the popcorn ready, it’s about to get really interesting…

End of housing boom will be costly, Scotiabank warns…

http://www.cbc.ca/news/business/end-of-housing-boom-will-be-costly-scotiabank-warns-1.2612405

Canadian Housing Boom Ending, Will Be Drag On Growth: Scotia…

http://www.huffingtonpost.ca/2014/04/16/canadian-housing-boom-end-scotiabank_n_5161118.html?utm_hp_ref=canada-business

#49 Tiger on 04.16.14 at 10:19 pm

Wtf am I invisible this site Is visabaly biast

#50 orinicoflow on 04.16.14 at 10:21 pm

Just lost a bidding war… Seller’s agent asked everyone to improve 4 times (!!!). We increased the price twice but refused to budge after he came back to us and asked us to improve again. We “lost”. But why does it feel like we won? We’re almost giddy right now.

#51 will on 04.16.14 at 10:30 pm

To smoking man #5 will you shut the f up? You post interesting stuff now and then. But why do you come here? Ask yourself this “Why do you come here?” No one wants to hear this stupid garbage. Shut up. It has no relevance whatever to Garth’s post.

#52 Tiger on 04.16.14 at 10:30 pm

DELETED

#53 Andrew Woburn on 04.16.14 at 10:31 pm

#1 Sider on 04.16.14 at 8:21 pm
The CHMC will go bankrupt, a fact Jim knows and did not want to face.
==============================

Your comment caused me to wonder what it would take for CMHC to go bankrupt. As CMHC is a crown corporation wholly owned by the federal government, it can’t although it can run out of cash and need a transfusion.

I checked the last CMHC financial statements dated September, 2013. I found this note:

“Under Section 11 of the NHA, the total of outstanding insured amounts of all insured loans may not
exceed $600 billion (31 December 2012 – $600 billion). At 30 September 2013, insurance-in-force, which represents the risk exposure of the CMHC Mortgage Loan Insurance Activity, totalled $560 billion (31 December 2012 – $566 billion)”

It is interesting that the total dropped slightly in the first nine months of 2013. However I think you would have to be wildly pessimistic to think that CMHC would ever have to eat more than 25% of this even in a catastrophic meltdown. Yes, $140 billion is not chump change but neither would it drive Canada into the arms of the International Monetary Fund.

What I found more interesting is that CHMC hasn’t just guaranteed these mortgages, it actually owns half of them through the Canada Housing Trust. So if I am following the plot correctly, in a meltdown, CMHC, aka the friendly Canadian government, will effectively be foreclosing on hapless millenials who can’t carry their Leslieville splits (after first sucking them in with loony credit policies). Does this sound like a winning political strategy? Is this F’s real legacy?

According to http://www.canadianmortgagetrends.com/canadian_mortgage_trends/securitization.html it works like this:

Lenders originate mortgages and arrange them into groups (pools)

Lenders sell these pools as mortgage-backed securities (MBS) to the Canadian Housing Trust (CHT), a CMHC-run entity

The CHT sells Canada Mortgage Bonds to generate funds to buy lenders’ mortgages

The CHT uses the MBS cash flows to make interest payments on these CMBs to investors.

Translation: The banks got the fees for organizing nearly $300 billion in mortgages that they didn’t even have to fund because Ottawa bought them.

#54 will on 04.16.14 at 10:34 pm

To smoking man #26, same as my earlier post. What are you doing here? this is a bunch of stupid shit. Why do you come to this blog? We are not interested in reading your garbage any more.

#55 Cici on 04.16.14 at 10:35 pm

Fantastic blog tonight Garth, you are right on the money.

And I love the quip about the washer/dryer combo…that’s actually a fabulous suggestion. Carmen could put that in timer mode to wash and dry a load of laundry every night while she and her family are sleeping.

As for dishwashers…we invested in a high-quality model, and I still think it sucks. It can’t even come close to washing dishes as well as I can by hand…

Vivo el apartamento!

#56 Nemesis on 04.16.14 at 10:38 pm

#WhatCouldPossiblyGoWrong!? #Tomorrow #IfIt’sThursdayThisMustBeBelgium #ThunderBall

http://youtu.be/5XIwUxmtX5U

#57 will on 04.16.14 at 10:38 pm

to smoking man #38, hey we don’t give a shit about your buddy’s movie premiere. We would just like you to SHUT UP. For gods sake this blog is about real estate and financial planning.

#58 R on 04.16.14 at 10:39 pm

When the media talks about “affordable housing” in Toronto, it’s framed in terms of rent controlled apts. for the unwashed masses. They completely leave out that giant swathe in the middle that is also basically unaffordable.

Perspective is a hell of a thing.

#59 Big Brother on 04.16.14 at 10:40 pm

Smoking man we served you the Kendal Jackson Chardoney tonight in the bar! Didn’t even know it did you! Now go feed your wife more money at her slot machine!

#60 Cici on 04.16.14 at 10:41 pm

#44 DZ

Here are two models similar to the one cited by Garth (one a little less expensive and the other a little higher in price):

http://www.homedepot.com/p/Haier-All-In-One-Combination-1-8-cu-ft-High-Efficiency-Electric-Washer-and-Ventless-Dryer-in-White-HWD1600BW/204226770

AND

http://www.homedepot.com/p/LG-Electronics-3-6-cu-ft-DOE-High-Efficiency-All-in-One-Washer-and-Electric-Ventless-Dryer-in-White-WM3987HW/202336996

#61 Smoking Man on 04.16.14 at 10:42 pm

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#62 Tiger on 04.16.14 at 10:43 pm

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#63 Average Joe, Vancouver BC on 04.16.14 at 10:44 pm

Garth, please drop us some investing tips for Easter !!! Almost everybody expect markets to adjust…soon, any tips for short term investing ( 6-12 months) ?
BIG THANKS for advise in the past.

#64 KommyKim on 04.16.14 at 10:48 pm

RE: #28 Waterloo Resident on 04.16.14 at 9:14 pm
The reason WHY interest rates will go up is precisely because the world is already bankrupt. When you loan money to someone who is broke, you want to get a higher premium for the risk you are taking,

I wish that were true. Greece just issued new 5 year bonds with a 4.75% yield. They sold like hot cakes.

#65 Dean on 04.16.14 at 10:49 pm

Is it my imagination or is the comments section becoming more populated by nutbars?

#66 Suede on 04.16.14 at 10:50 pm

Ok so the banks may start coming out to talk down the market.

They obviously have a strategy to make money off of stalling prices and resetting mortgages.

but what is their angle…

#67 Smoking Man on 04.16.14 at 10:52 pm

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#68 Smoking Man on 04.16.14 at 10:57 pm

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#69 James on 04.16.14 at 11:08 pm

#24

That is because the jobs being taken by TFWs are mainly private sector. Hence, the public sector unions (who allegedly work for the good of all) are silent.

#70 James on 04.16.14 at 11:11 pm

#39

I have to say that I find a report by the PBO a little more credible than a personal anecdote. Sample sizes of one are not exactly a firm base in this sort of affair.

#71 Retired WI Boomer on 04.16.14 at 11:12 pm

Stories of the young, middle-aged, even old and indebted are all too common, and so unnecessarily SAD!!!

Garth’s rule of 90 works. Buying with a 20% down payment should be required to cool -or kill- the house flipping speculators. When you buy a home, or even a car with 20%of your own money in the deal the numbers look far more frightening, as you have “stock” in the purchase.

While I hated DEBT these days, I carried some for most of my life, the house, and the never ending car payments!
Then I got smart(er) as I hit 50.

Now, I think more like the investors, and savers not those consumers. We need both, but trust me, it is much more profitable to be an investor, than a consumer.

Whatever you decide, know what you are doing, and why you are doing it. Best of luck.

#72 Sam on 04.16.14 at 11:15 pm

Nothing will happen. The market will break all records like the previous dozen years. guaranteed.

#73 Smoking Man on 04.16.14 at 11:23 pm

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#74 Patrick Gunville on 04.16.14 at 11:29 pm

Garth, I don’t know Toronto, but Vancouver you can get a single family home in the suburbs (Surrey/Maple Ridge) with a basement suite renting for at least $1000 per month.

If someone is going to rent for $2000 or could pay a $2000 mortgage with $1000 rental income, assume also a rate locked in for 10 years in a home they are committed to for the long term.

Do you think if a wife is that desperate for a home, that this could be one way to hedge yourself against a correction?

Like stocks, real estate eventually recovers from a down-turn and goes up with inflation and money-printing.

Say the money for the down payment isn’t coming out of their stock portfolio?

#75 Seriously, a nickname? on 04.16.14 at 11:31 pm

Garth calls the couple’s job (and by extension their combined income of ~115k) “so-so”.

I say
http://imgur.com/VJrACJJ

#76 Roy on 04.16.14 at 11:32 pm

“So now I am having hard time staying in apartment with 2 kids, and no washer/dryer means 3 hrs of weekend time for using downstairs laundry.”

Gosh, life is so hard. Remember how hard it was back when we had to wash by hand. How would we ever survive that now. A decadent spoiled culture we are

oh well that justifies buying a $420K mansion – with no ability to conceptualize how to actual get in or pay for it.

But hey our GDP is heavily dependent on housing and we must find a way to get these people into that house = Ponzi.

How about the TFW program, helping out corporate Canada fill those much needed highly-skilled roles.

LOL

Top TWF jobs according to Michael Smyth:
1) Harvesting labourer
2) Food service worker
3) Babysitters, nannies, and parent’s helpers
4) Truck driver
5) Nursery and Greenhouse worker

http://www.theprovince.com/news/bc/Smyth+blind+been+turned+temporary+foreign+worker+program/9746144/story.html

Now that is something we as Canadians just cannot do. The training required must be immense.

70,000 TWFs in BC
85,000 TFWs in AB

Worth watching the vid:
http://www.cbc.ca/news/canada/temporary-foreign-workers-being-approved-too-easily-expert-warns-1.2609653

Wage suppression, further cornering of youth into the debt-based education-scam system, or into the house horny-speculation system. Money earned by TWFs going out the country

On top of HAM, citizenship for sale, corporate sell-off to foreign transnationals and invasion by big US box stores = Canada divide and conquer

Slave society exists right now, sheep is almost too lavish a name for the public. Zombies in cages about to be slayed is a better metaphor

#77 Smoking Man on 04.16.14 at 11:34 pm

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#78 Jimmy on 04.16.14 at 11:35 pm

Thanks #30 arjosoer. I don’t have a specific property in mind but I’ll try your method with a few active listings. Or I’ll bite the bullet and ask a realtor(circle R).

#79 Uh Oh Canada on 04.16.14 at 11:38 pm

Driving home tonight and noticed gas is at $1.49. Our rent will increase 3% as it has every year. So everything is going up except for wages. I made more money in the early 2000s than most young people I know who are performing the same job.

Overheard a conversation of two mothers talking about their Gen Yers. One has a Psychology degree and is working as a telemarketer. The other son has a Political Science degree and is taking a one year course in Business.

It’s not hard to discern that hard times are ahead. Stay liquid folks.

#80 Kelowna Resident on 04.16.14 at 11:47 pm

‘He also said RE is collapsing’

He is correct.

In K-town the 600K+ is very slow – houses have been on the market well over a year because the owners cannot
a) afford them
b) take a loss of 100K+

the party is over in BC

we built way too much of the wrong kind of houses

#81 valleyrenter on 04.16.14 at 11:47 pm

#20-Bottoms_Up, heard one the other day that if you bring your stuff to a certain pawn shop in New West, they’ll give you up to $3,000 to use as a DP towards a new Kia at the local dealership. Brutal.

#82 TimV on 04.16.14 at 11:55 pm

Wow – I can’t believe Garth knows about the all-in-one ventless washer+dryer secret. Anyhow.

Ricky and Carmen: I bought mine about 10 years ago when the LG WD3274 first came out. It was a wonderful timing, since the only options prior to that had been low-quality stuff. The small one cost us about $1600 (the large would have been over $2000, I think). It paid for itself in like 2 years or less based on the cost of laundry charged by the apartment building — never mind the convenience.

And having a washer/dryer that spun-up to 1400rpm truly makes you feel powerful. That said, by the time it was 10 years old we never ran it on the 1400rpm option anymore …. we were worried it would fly apart.

I cannot over-recommend this device to anyone in an apartment for more than 1 year. It was awesome. We did all the cloth diapers from the first kid in it, too (but that did mean running it daily due to the fact that we had gotten the small size version).

The only time it failed us was when we had bedbugs. The amount of laundry was just too much and we had to pay something like $50 to $100 for the basement laundry machines.

One thing to be aware of: you ideally want to hookup to only the cold water supply (use “cold” detergent). Don’t use hot+cold from the same faucet to modulate the water temperature (except in the extremely unlikely case that you have a backflow preventer valve on the incoming water pipes). Towards the end we used cold water only, but had an extra hose for hot water hookup when we wanted it.

#83 Mixed Bag on 04.17.14 at 12:00 am

Carmen, you don’t have enough money to buy a house. You don’t have enough money put away for unexpected events such as a job loss or illness.

No dishwasher? How do you survive.

#84 Kreditanstalt on 04.17.14 at 12:09 am

$115,000 a year? Netting $6,000 a month? And they can’t make it?

Find some real people.

#85 sheane wallace on 04.17.14 at 12:17 am

Janet Yellen said low rates here to stay for a long time.

Oh boy, have I not seen this movie before.

#86 Eira on 04.17.14 at 12:19 am

With a Federal election coming up next year the Harper government will do everything it can to maintain the bubble and avoid a badly timed decline in house prices….I doubt we have reached the peak yet.

#87 sheane wallace on 04.17.14 at 12:19 am

The thing with the bond rates is scary. The bonds will go down to zero and then the currency behind them will go to zero as well.

Do not sell your stocks/gold/real estate that you own.

We are entering the beginning of the end of the drama.

#88 LJ on 04.17.14 at 12:19 am

Here something that might be a bit troubling (and it is a must read):

http://www.forbes.com/sites/gordonchang/2014/04/13/china-property-collapse-has-begun/

The most salient point that we have heard here many times before:

“fewer people would buy because most people buy property only when they think the price is going up.”

#89 Larry1 on 04.17.14 at 12:19 am

Renting a house in Van as a family of 4 with yard, laundry, garage, etc. Rental cost is within 25% of the rent said in Garth’s posting. Owning makes no sense when tear downs in the hood are valued north of $1.5

#90 lisa T on 04.17.14 at 12:32 am

Although I love your advice, Garth. I don’t think Carmen can have a washer/dryer that doesn’t vent. Still, cheaper to put in the vent…

#91 James on 04.17.14 at 12:44 am

Its not obvious to you that house price has been doubling every 20yrs. With increasing population, desire to be more central, and globalization, RE price is destined to go up faster in the long term. There may be some short term bumps but overall people stay put. You don’t try to time the market..

#92 Win on 04.17.14 at 12:48 am

Simon Black of Sovereign Man reports that Li Ka-Shing, arguably the richest man in Asia, is liquidating Chinese assets.

Is that a harbinger??

#93 devore on 04.17.14 at 1:06 am

…your monthly (loan plus property tax and insurance) will be more than $2,500 – plus those utilities.

Funny how the rental number adds utilities, but the house numbers do not. I don’t believe home owners receive free utilities. Most likely, all else being equal, the house will come out much more expensive, because rentals usually include heat and hot water, certainly apartment/condos typically do. Would you like to see a utilities bill for a run down semi in the burbs?

Oh well, anything to make those numbers look slim and sexy.

#94 Turtle on 04.17.14 at 1:41 am

Don’t try to solve the washer and dryer problem by buying a house. Just buy washer and dryer and move to the place where you can install them.

You need a taxi – you take a taxi, you don’t buy a taxi.

Also, Carmen, you have to find a way to save more. You bring home $6,000/month and pay $1,300 for the shelter. $4,700/month on food and stuff is a lot of money even with two young kids.

#95 Humpty Dumpty on 04.17.14 at 1:57 am

What could go wrong?

This….

The Money Velocity picture is not pretty. The declining rate has broken lows set 50 years ago. Technically, the velocity of money is the frequency at which one unit of currency is used to purchase domestically produced goods and services within a given time period, like an inventory cycle time. In other words, it is the number of times one dollar is spent to buy goods and services per unit of time. If the velocity of money is increasing, then more transactions are occurring between individuals in an economy. The result would be that growth (as measured in GDP) should be rising. With falling velocity of money, then fewer transactions are occurring and a recession is indicated. Such is the present case in astonishing rapid deterioration. Consumers and business are holding firm their money rather than investing it, as they see poor prospects. New capital formation is not occurring inside the USEconomy, or pitifully little. Debts are being dissolved, usually in default. It should be noted that the velocity of money has also been falling in the EU and Japan. The entire global economy is in recession, the pathogenesis shared.

http://www.gold-eagle.com/article/glaring-qe-failure-spotted

#96 bill on 04.17.14 at 2:30 am

a word or two of advice to those who would purchase one of the washer dryer appliances. get a really nice one.without the dryer.hang the clothes on a rack or line in the apt.
check all the fittings to make sure they dont leak as in take it apart and see if they did a good job.the last two that flooded did so on their very first use.
and make sure the manager doesnt find out about it.
when they leak [and many have absolutely crap fittings]
it is a big problem for the tenant downstairs.[ who may seek damages if something expensive gets ruined]
also the lint should be very carefully strained out as it plugs up the drains and pipes. kitchen sinks are not the right place really.
these two problems are invariably how we find out about them.
If we find out that you have one in one of our apartments you will be told to remove it.

#97 sciencemonkey on 04.17.14 at 3:28 am

I liked the comment from yesterday on the stages of acceptance for ridiculous RE prices.

I’m a scientist, but my eyes gloss over when you talk about house price data. I can’t muster the energy to care if houses may possibly cost 3x more than I can responsibly afford, rather than 4x. Talk to me when a 1000 sq ft townhouse 30 min from work during rush hour costs less than $200,000.

On the topic of appliances, my fiance found a great full size portable dishwasher (older Maytag) on craigslist for $75. Brought it home in my Honda Fit, cleaned it, and it’s been great. I should consider a full size portable washer dryer as well since I spend at least $400 a year on laundry fees in my building, but I need to make sure the unit will use the same faucet hookup. Of course doing laundry in my unit will cost me more in electricity.

Also found a great two hose portable air con for $200. Craigslist can be good for appliances.

#98 just some guy on 04.17.14 at 4:46 am

Is it just me or is it always women who are pushing to make these foolish house purchases? Hey honey I have an idea lets buy the all time record high.

#99 Happy Renting on 04.17.14 at 6:20 am

The $900 washing machine sounds great. In my case, though, I believe there’s a clause in my lease either outright prohibiting such an appliance or requiring property management’s permission. If it’s small enough to smuggle in, though, Carmen and Rick may be in business!

——-
#35 T.O. Bubble Boy on 04.16.14 at 9:35 pm

Did the RE agent also show you the couple’s wedding picture and read a heartfelt letter about their commitment to the community, etc.? Awfully optimistic, knocking on doors with below-market client budget… Must be desperate for a sale!

#100 World Traveller on 04.17.14 at 6:44 am

#32 Jas Girn on 04.16.14 at 9:28 pm
I hope Smoking Man fades for a day. So annoying. Garth must be really annoyed by this buffoon.

*****

When reading the comments I look for the name of the poster first, when I see SM I scroll past, I haven’t read one of his posts in a week, getting pretty good at it as well.
Garth probably allows his posts for comic relief, although no one is really laughing.

#101 World Traveller on 04.17.14 at 6:46 am

So the housing crash is coming, how can we benefit from it? I am a renter currently, have some small investments but would really like to clean up now.

#102 World Traveller on 04.17.14 at 6:47 am

Do we think that if the housing boom crashes, that the feds will put even more incentives on the table to goose the economy again? Maybe a return to 40 year mortgages, with this being an election year I can’t see Harpo just lying down and letting the house of cards fall.

#103 maxx on 04.17.14 at 6:52 am

“By the way, a portable, washer-dryer all-in-one appliance which is ventless and requires only a kitchen faucet to operate can be purchased for $900. There. I just saved you $432,937.”

I have one, an “Equator”, made in Italy. Best household appliance ever, bar none. I’d give up most of the others for this one.

#104 liquidincalgary on 04.17.14 at 7:01 am

@ #5 Smoking Man

dear smoking man,

this is an economics blog.

please get a twitter account; therefore, those who care, can follow you there.

sincerely,

someone who knows who he is

#105 liquidincalgary on 04.17.14 at 7:04 am

@ #10 Waterloo Resident

wow!

you would almost think that the AFL pres may be biased, non??

#106 liquidincalgary on 04.17.14 at 7:12 am

@ #26 Smoking Man

congratulations smoking man!

you have officially been upgraded to ‘TROLL’ !!

#107 Ayn Rand Army on 04.17.14 at 7:15 am

I couldn’t believe the stupidity when i watched the agenda last night from three women. All very nice ladies who believe they are making sense but in truth have no idea about economics and have no depth of understanding of issues except the public talking points they agree with from which their train of logic and reasoning stems from.

They don’t even realize that everything the government touches is an expensive boondoggle because the same affliction these women have is rampant in government because they generate public talking points.

You gotta see it to believe it. 16 hours a day!

The Agenda – Paying for Political Promises

http://theagenda.tvo.org/episode/202973/budget-planning%3F

#108 liquidincalgary on 04.17.14 at 7:16 am

@ #28 Waterloo Resident

US loses world reserve currency status? really?

who else has the depth and breadth of the US debt market to replace it?

what currency does EVERYONE flock to during times of distress/uncertainty??

we’ve been through this before

#109 Ayn Rand Army on 04.17.14 at 7:22 am

I can’t find the video of last nights show for the agenda but here’s the audio of it in the podcast tab.

http://theagenda.tvo.org/podcasts

http://www.tvo.org/podcasts/theagenda/audio/2196995_48k.mp3

#110 Ayn Rand Army on 04.17.14 at 7:40 am

I think Jim Flaherty died because he realized the truth that low interest expansionary monetary policy does not work and in fact has made the real economy worse by propping up all the losers at the expense of everyone else.

A governments objective for monetary policy for a strong economy is to make the economy run on as little cash as possible. So the exact opposite of the printing theft we’re witnessing globally today and the shambles its creating.

Remeber, barter or no money, is the other extreme of infinite money supply. And in the end everything is still barter and money is only the grease that allows trade to function better.

Too much money and creation by no effort or production is simply stealing from those who do produce.

Nothing is more expensive than when its free from the government.

#111 gmc on 04.17.14 at 8:05 am

velocity of money, we are in the process of going down…check these stats
outhttp://news.goldseek.com/GoldSeek/1397156826.php

How can this guy write this if is isn’t true????
CANADA DITTO ON FAILURE

The Jackass howls in laughter at the claim that Canada is different, an independent nation, a refuge of wiser leadership, the Great White North with more integrity. What nonsense! Canada is in the US pocket, and has been for a very long time. The arguments that Canada is different or better or free from gold corruption are truly baseless and stupid. The big Canadian banks short gold with Wall Street banks, and have been doing so for a long time. See the Scotia Mocatta alliance with JPMorgan in recent months. The Canadian Govt efficiently vacated all their gold in the 1980 and 1990 decades. It was probably stolen in part by Mulroney, just like as Bush & Clinton & Rubin stole the US gold. See the hidden brisk activity at Barrick Gold, where the ex-prime minister sat on the Board of Directors. Pay close attention to the Evergreen gold contracts by Barrick, which never force under contract the delivery of gold, only the sale under dubious specious contracts. Then the big Canadian banks are deeply committed in the Wall Street and London derivative entanglements, just like the big US banks. All their big banks are hollow reeds, just like in the Untied States. Lastly, the Canadian stock exchanges engage in rampant naked shorting of the mining stocks, not by those who wish to preserve the fiat currency system, but rather by the investment banks that fund the capital requirements for the mining firms themselves. They sell more shares than granted on finance deals. The most disturbing gold factor from Canada in the last year has been the collusion of Scotia Mocatta with JPMorgan in the provision of gold bullion. They have been offered some special deal for the future, but that future will include a charred landscape and devils as warlords. Scotia Mocatta is in Satan’s service at the Wall Street altar. The old formula still holds: CANADA = UNITED STATES / 10(just like always). The Jackass expects an extreme conflict very soon, as Canada is far more a Chinese commercial colony than the Untied States. My expectation is that Toronto, Ottawa, and Vancouver will soon begin marching to a different drummer out of Beijing, Shanghai, and Hong Kong. A big hat tip to David Chapman for his recent article (CLICK HERE) on the Money Velocity subject, where the graphic was obtained

#112 TurnerNation on 04.17.14 at 8:20 am

Re. Hipsters, it’s almost like they are the Betas – who can suddenly buy 800k semis?

But Alphas control the money supply. When they fold up their tables, well look to our southern neighbours for that consequence. If you cannot spot the sucker in the room…

#113 AfterTheHouseSold on 04.17.14 at 8:27 am

#99 World Traveller
“…with this being an election year I can’t see Harpo just lying down and letting the house of cards fall.”

I think the Conservatives will use the coming economic downturn to their advantage. The election strategy will be “vote for a steady, experienced hand on the wheel to guide us through another financial crisis.”

#114 Steve French on 04.17.14 at 8:33 am

Stay cool and lay off with the anti-Smoking Man diatribes folks.

No bullying policy on this blog.

Smokey is a true Ronin– a masterless road warrior Samurai.

He speaks a different language to many other humans who are not plugged in.

He is an eagle scout… sending us daily reports from the frontier.

Remember however to keep things in moderation with the JD SM.

Long is the way, and hard, that out of hell leads up to the light.

#115 Aggregator on 04.17.14 at 8:38 am

GTA high-rise sales remain strong in Q1

"The building industry is committed to building homes people can afford to purchase. Our members have been heavily focusing on assisting purchasers with deposit and rental guarantee programs."

As I stated many times, everything is controlled and now being sold abroad.

#116 :):( Ying Yang on 04.17.14 at 8:41 am

#5 Smoking Man on 04.16.14 at 8:27 pm
Who the hell are we?
As I slowly morph into a character of my imagination, I don’t know who the real me is anymore.. The mild mannered code smith, the loving husband and father, the short term rental addict. The drunk, the raving loony Smoking Man.
A massive ego is freedom..

……………………………………………………………………….

Smoking Man you have some interesting thoughts on the market and I agree that you do have a massive ego but what did you do to have six deletes? Have fun in NYC just returned from there yesterday. They had snow too weather sucks. Cold and damp. Better get back to your thoughts on $$ instead of Casino, everyone is trying to chirp you!

#117 Shawn on 04.17.14 at 8:55 am

Short-Term Investing

Average Joe at 63asks:

any tips for short term investing ( 6-12 months) ?

******************************************
No such thing. 3-6 months is a time frame for saving.

Investing requires a longer time frame. Hoping for capital gains in 3 to 6 months is called speculation.

For 3 to 6 months, invest in reading some Buffett.

#118 T.O. Bubble Boy on 04.17.14 at 9:09 am

$900k House of the Day for Thursday, April 17th:

3 Finalists
1) *TRIPLE-LISTED* $999k condo bungalow on Cooksville WITH $595/month maintenance fee
2) A $989k 2-bdrm FSBO bungalow (in a premium neighbourhood, but still close to $1M for a tear-down)
3) $999k barely-reno’ed FSBO on 21ft lot near College/Dufferin

WINNER
#3: Not only is this a tear-down in an “up and coming” neighbourhood, it is For-Sale-By-Owner (read: cheap sellers) AND listed right at the magic sub-$1M price point. This is the ultimate CMHC bubble house!!!

#119 T.O. Bubble Boy on 04.17.14 at 9:26 am

@ #99 Happy Renting on 04.17.14 at 6:20 am
——-
#35 T.O. Bubble Boy on 04.16.14 at 9:35 pm

Did the RE agent also show you the couple’s wedding picture and read a heartfelt letter about their commitment to the community, etc.? Awfully optimistic, knocking on doors with below-market client budget… Must be desperate for a sale!
———————————-

No – no wedding photo… just a fuzzy story about buyers who want a house just like the ones on my street.

She was insisting that it had to be an “old” house, not a “new” house.

So, here’s my theory: she actually represents developers, and they need to stay under $1M to get a CMHC-backed mortgage and minimize the up-front cash (i.e. get a 5% down mortgage vs. 20% down).

#120 Just some guy on 04.17.14 at 9:31 am

Here is a tip that may help some of you in composing your comments: use paragraphs. A paragraph provides a break for the reader and it makes it easier to scan the entry.

Use a topic sentence at the start of each paragraph. This will enable your reader to get the gist of what the paragraph contains and it will allow them to scan your entire comment.

#121 unbalanced on 04.17.14 at 9:39 am

To # 100 World Traveller.
I agree with you 100 %. I have been doing that for months. A person can only take so much bullcrap. He’s always on his own agenda ranting and raving about something. Hate this, hate that, bash wife, bash his kids. Sometimes you can read a book by its cover. I woke up along time ago and threw it in the garbage where it belongs. I could care less if he reads this or not. I have called him on many things with no response.
Take care.

#122 sciencemonkey on 04.17.14 at 9:40 am

Hmm maybe I will pick up one of those $1600 combo washer/dryers. Any ideas on what I should do if the proprietary fitting on my maytag dishwasher is different than what this washer/dryer uses?

I’m really tired of governments that work against the interests of the middle class. In the past I voted for the cons so they would abolish the long-gun registry; in hindsight I realize the cost of that with respect to all their terrible economic policies. Now I will only vote for a party that abolishes the TFW program and the CMHC. Seriously, can you think of a program better designed to hurt the working class than the TFW?

#123 sciencemonkey on 04.17.14 at 9:40 am

Fitting for the kitchen faucet, I mean.

#124 IVoteIndependent on 04.17.14 at 9:42 am

Home price slowdown leaves millions underwater

“The pool of underwater borrowers peaked at 12.8 million, or 29 percent of all properties with a mortgage, in the second quarter of 2012, according to RealtyTrac. Rising prices have lifted millions back above water. As of the first quarter of this year, some 9.1 million homes (or 17 percent of homes with mortgages) were “seriously” underwater, owing at least 25 percent more than property’s estimated market value.
But the recovery has been very uneven. Like everything else about real estate, location matters a lot.”

http://finance.yahoo.com/news/home-price-slowdown-leaves-millions-110000838.html

#125 };-) aka Devil's Advocate on 04.17.14 at 9:54 am

Growth is the lifeblood of this economic system. Without growth our economy fails. We will do whatever it takes to have growth. All economic measurement is aimed at growth. In this world growth is good, stagnation or recession is bad. Sometimes in pursuit of growth we overshoot and the laws of economics claw back those ill-gotten gains just as they did in the last recession of 2008. But overall, despite the setbacks from time to time, we continue to grow. From hunter gatherers to agrarians to industrialist to technologists each change in the way we do commerce has resulted in exponential growth and so too will the next as we continue to seek better ways that facilitate growth albeit too often at too high an unforeseen consequential cost. But we are, after all, just shepple ;-)

For as long as we adhere to this economic model we can expect that status quo to continue.

Yes ultimately this economic model is unsustainable and it will break beyond repair, but not in our lifetimes, not in your children’s lifetimes, not probably in even your great grandchildren’s lifetimes. For the foreseeable future we will, as we have always managed to do in the past, bubble gum this economic model back together one way or another and continue down the “growth road”. Why? Because to abandon this economic system would be too costly to those who benefit most by it, they who have the power, they who manage it. If you were them would you let it go for something that was better for all, for the shepple? Yes it is corrupt. What do you expect? This economic model breeds corruption, it a by-product of the system.

Expect income disparity to continue to widen the gap between the haves and the have not’s as we approach that too distant ultimate failure of this ultimately unsustainable economic model which will precede the implementation of the new improved one. But, again, that will not happen in our lifetimes. The growing income disparity will be a catalyst of the failure though. But such rebellion is a long way off still and the cost of such revolution would be too great in the meantime as we are still too naive to know what we really want were we to be handed the opportunity to change things. We’ve got a long way to go still.

So get over it. Learn to live with what we have because you can’t change it by fighting it. The best you can do is learn to work within the confines of its absurdities, understand the absurdities and make the best of the situation on your own terms.

There are things you can change and those you cannot. If you focus on the things you can change instead of beating your head against the wall over those you cannot you will find that, in time, the sphere of things you can change will grow larger and larger and so too will your happiness.

House prices will continue to rise and fewer and fewer will be able to afford them. Want one? Buy it now because it isn’t likely they will get any more affordable than they are today as their cost goes up and your wages, probably, will not keep pace unless you follow the advice in the preceding paragraph and stop beating your head against the wall over the things you cannot change. When you stop beating your head against the wall over the things you cannot change and focus on that which you can change you will find that a whole new field of opportunity opens up to you and suddenly those things you cannot change today you will at least have influence over for the future.

“I fear the day technology will surpass our human interaction, for then the world will have a generation of idiots”. Albert Einstein

#126 Alistair McLaughlin on 04.17.14 at 9:59 am

Word of caution on the portable apartment washing machine: Many apartments specifically ban them. Usually they cite some barely existent flood risk. The real reason is they don’t want to lose revenue from the coin operated facilities. Even if the laundry room is operated by a third party, often the landlord will agree to ban ensuite laundry as part of their contract. In any case, the portable units are barely adequate for one or two people. They aren’t meant to handle laundry for an entire family, at least not the sub-$1000 models.

I lived in an apartment in Ottawa a few years ago. They renovated the laundry room and installed all-new equipment. Top loaders. How could that make sense? I know toploaders are cheaper, but they use so much more water. Wouldn’t that eventually negate the savings, given the volume of use? (This was a 21 story building – the dozen washers ran almost constantly from 8 a.m. to 10 p.m.)

Ah, but there’s the rub. Front-loaders spin faster, wringing out more water and drastically reducing drying time. Many apartment dwellers of modest means would be tempted to forego drying altogether in favour of just hang-drying them in their suites. Can’t have that. That’s a $1.75 revenue loss for every load not going into a dryer. (This is less of an issue in a laundromat, since few people want to haul loads of wet laundry back home. In an apartment laundry facility, you’re already home.) So inefficient top-loaders it is.

I still rent, but it’s a townhome. Gawd I hate apartment buildings. This couple is earning decent income. Renting a nice 3 BR town for $2000 plus utilities is still cheaper than buying, even before property taxes & maintenance. They can sock away the $600 to $700 per month savings until they have a real down payment.

#127 Pr on 04.17.14 at 10:03 am

…The moral compass around here is broken…
Thank you central banks!

#128 sciencemonkey on 04.17.14 at 10:10 am

That home depot link was for murican prices. Looks like us Canadians get shafted once again:

http://www.homedepot.ca/product/42-cu-feet-washer-dryer-combo-white-wm3987hw/942370

http://www.homedepot.ca/product/27-cu-feet-washer-dryer-combo-white-wm3455hw/942425

Found a business with cheaper prices, both of these can use the portability kit:
http://barcelonaappliances.ca/lg-all-in-one-laundry-machine/
http://barcelonaappliances.ca/lg-2-3-cu-compact-all-in-one-combo-washer-dryer-portability-kit/

(I’m not affiliated with any of these businesses.)

Maybe there are better prices out there, gotta keep looking.

#129 TimV on 04.17.14 at 10:18 am

#84 Kreditanstalt: Carmen and Ricky seem reasonably real. They started graduate studies 5 years ago at the same time as they had their first child. Add daycare and tuition, all on loans since they were students at the time. They’ve worked the last two or three years, paid off the debt, and saved a bit. All while still paying daycare, since now they have a second child (8mths). 115k gross family income may seem like a lot, but you add those expenses and I they may have done pretty okay to save $25k. Probably could’ve bought a cheaper car, though.

#96 bill: Apartments get real damp when you hang dry clothes. You really want the combined washer+dryer.

#122 sciencemonkey: Many faucets have a simple nozzle that can be screwed-off, and an adapter placed on it for the washer/dryer or dishwasher. Our second apartment (two bath) had three sinks, one of which wasn’t adaptable so we asked the landlord to replace it (it was old and scratched – so that was our excuse). You do want to confirm that you can remove the aerator before spending $1000+ on any such appliance, though.

#130 Midnight Mint on 04.17.14 at 10:20 am

Not all rentals allow extra appliances, or they want a larger damage deposit otherwise it would have been cheaper for myself to buy a portable washer/dryer rather than fork out more money for coin laundry

#131 sciencemonkey on 04.17.14 at 10:20 am

@126 Alistair
That’s evil.

I dry towels and sheets, but I like to hang dry my clothes to prevent shrinking. Luckily my walkup has a front-loader washer. Anyway, if you need to speed up air drying, hang the clothes in a smallish room, set up a small dehumidifier in the room, close the door, and let it run for 6 hours. Then turn it off and leave the door open overnight.

#132 sciencemonkey on 04.17.14 at 10:25 am

@129 TimV
My two bathroom sinks aren’t an option because there isn’t enough room in those areas. My concern is that my kitchen sink already has the Maytag dishwasher adapter screwed in, so how can I set it up for an LG washer/dryer as well? (It would be a pain to be screwing and unscrewing those adapters.) I wonder if I can find a quick disconnect kit that goes from standard faucet to standard faucet, so that I can switch between the two different appliance adapters.

#133 Dr. Wu on 04.17.14 at 10:27 am

#6 Debt’s Dark Embrace on 04.16.14 at 8:30 pm

This is the new normal. Interest rates will not rise to “historical norms” cuz the world will go bankrupt.
How is that not obvious ?
—–

“historical norms” sounds so comforting; we can also be comforted by the “historical norms” in 20th century war and genocide. Interest rates don’t have to go up for everyone to be a loser. The real war is between usury and labor. Guess who’s winning?

#134 Roger_Home_Inspector on 04.17.14 at 10:36 am

I think Ricky and Carmen’s response to the issue at hand is a common one, and dare I say the one that society has programmed everyone, even new Canadians, to believe to be correct. Specifically, when faced with and issue- spend as much as possible to create an “ideal” solution for yourself. After all, YOU DESERVE IT!!!

I see this response all the time as it relates to a variety of issues family’s may face. For example, a common reason family’s see the need for larger homes is because they need “more space”. Their current digs just can’t handle the volume of stuff that they have accumulated.

Fair enough. Family’s do grow, as does the volume of possessions. But what I find most houses full of is stuff the family doesn’t use but feels the need to store anyway. I can’t tell you how many home I go into and storage rooms and garages are stuffed with old bikes, silk flowers, fake ficus bushes, out of style home decor and computer systems that went out of style before the microchip was invented. In reality, none of these items are likely to add any value to the family who owns them, so why pay a premium for a larger home and the subsequent expenses that go along with it to store what is essentially junk? (Oh, and how do you know that they don’t use the stuff? Look at the dust covering it with a flashlight. If it’s been recently disturbed, you’ll see finger prints and handling marks in the dust. Most of the stuff I see has been collecting dust since Christ was a carpenter, untouched).

So let’s really step back and look at the options. Okay, we’re tight on space… what can we do? First, we could definitely buy a larger home to store our stuff. Because you never know when the plastic ficus motif will make a comeback. The pro is that your possessions in their entirety are readily at hand if you need them. The con is that it’s an expensive, specifically when you’re using leveraged money to buy the bigger shack. And the fake ficus will not come back into style- just saying.

Now let’s think outside the box. First, we could cull the stuff we’re really not using and not likely to in the future. With free selling sites like Kijiji and Craigslist being so popular, you can probably recoup some of the money you shelled out for stuff that you really didn’t need in the first place. Items that aren’t salable can always be donated to your local thrift store free of charge. Many of these thrift stores (like Goodwill and Mennonite Central Committee Stores) use the proceeds to support good causes in the community. You don’t need as much space, maybe can pocket some coin and can help community organizations. Win, win, win.

Further out of the box, why not rent a storage unit? If you really find that you have stuff like seasonal sports equipment and decorations etc… that your family truly want’s to keep but don’t have the room for, why not? Costs vary based on the size of the unit you want and whether or not you want the unit climate controlled but I think that anyone would find that square foot to square foot, the storage locker is a far cheaper option to your family’s storage needs, especially in major centers. The best part is that if you need a larger or smaller unit, or you find that you no longer require the space you can modify or end your rental at any time. Within 12 months if you have a contract. It’s basically “renting real estate” for your stuff. No skin in the game and tons of flexibility. Sure, you have to drive down to get the Christmas decorations and then return them to the locker in the new year, but transportation cost and the time it takes to pick up and drop off the Christmas tree annually is a small price to pay when you consider the alternative to be a larger mortgage for the next 30 years.

So back to Ricky and Carmen’s situation, let’s apply the same out of the box thinking to their matter.

The stand alone washing machine is a great idea. A $900.00 investment to provide you with laundry facilities in your current situation. Note too that if you’re concerned about leakage from a washing machine in your unit, there are solutions to that too. You can purchase a poly drip pan for the machine to catch any leaks that may occur right at the unit. You can also get automatic water shutoff valves that detect leaks in the system they’re attached to and detect any water on the floor and shut the flow off instantly. Bit more of an investment but if it let’s you maintain the use of your in suite laundry machine, why not? Check these out:

http://www.wattscanada.ca/pages/learnAbout/intelliflow.asp?catId=

http://www.floodsaver.com/

Further, what about wash and fold laundry services? Drop your stuff in the morning, pick it up clean and folded in the evening. Cost involved for sure, but how awesome is it to get time back with your kids on the weekend and have starched boxers too? Note also that some of these facilities actually drop off and pick up so eliminating the need to transport your family’s laundry yourself. You may also find someone in your building that provides maid or cleaning services. Or maybe they are a stay at home mom. Why not approach them and pay them to do your laundry?

Maybe alternative solutions aren’t that sexy, but they sure help to keep your hard earned dollars in your pocket and keep you flexible and in control. I generally find that the “simplest” solutions are often really the most convoluted and expensive.

If I were you Ricky and Carmen, I’d be washing my clothes on a rock down by the river before I’d buy a larger house to accommodate two full size laundry machines.

(p.s.- my family has a GE Profile dishwasher. It was almost $1500. Guess what we do with it? We store Tupperware in it because dishwasher suck. Use the sink guys).

#135 Old Man on 04.17.14 at 10:41 am

Its the SOLOROCK 24″ ventless washer dryer combo for $899.99 that is mean’t for them.

#136 Gabi on 04.17.14 at 10:42 am

416 area detached-$ 1,012,172
yeaaaaaaaaaaaaa

#137 Ralph Cramdown on 04.17.14 at 10:46 am

#119 T.O. Bubble Boy — “So, here’s my theory: she actually represents developers, and they need to stay under $1M to get a CMHC-backed mortgage and minimize the up-front cash (i.e. get a 5% down mortgage vs. 20% down).”

I’m not saying that doesn’t happen, but it is fraudulent. Lenders don’t lend 95% against, and mortgage insurers don’t knowingly insure properties that the buyer plans to make unsellable (e.g. knock down or start major renovations. For that, you need a builder mortgage.

That said, this little gem sold for $925k last fall after a month on the market at $989k. I’m guessing it’s worth less just now. Anyone who works for a real estate lawyer could pull the standard charge forms of the mortgage that are registered on title and see if the owner is in breach.

http://www.thestar.com/news/crime/2014/04/17/house_in_little_italy_collapses.html

#138 Pete on 04.17.14 at 10:46 am

It is becoming increasingly evident that Poloz is a weak man looking for an out from his current predicament.

He is clearly intent on bailing out those who have recklessly lent and borrowed during this credit binge, by spurring inflation and trashing the dollar. The rest of us will pay. How typically Canadian.

What he should be doing is grasping the nettle, raising rates, and letting those that have over-indulged pay the price. Not likely.

#139 Shawn on 04.17.14 at 11:12 am

Usury? Seriously?

Dr. Wu at 133 cliams / asks:

The real war is between usury and labor. Guess who’s winning?

******************************************
Not you, Wu, I’m guessing.

Did you fail to put aside some of your labour income to invest as capital so that you would not be dependent only on labour income?

P.S. The year 47 Current Era called, it wants its vocabulary back.

#140 Ralph Cramdown on 04.17.14 at 11:29 am

The most interesting — and depressing — thing I took from the Bank of Canada’s quarterly report:

Economic growth in Canada is projected to average about 2 1/2 per cent in 2014 and 2015. The Bank continues to expect that the gradual strengthening of the global economy and the recent depreciation of the Canadian dollar will lead to a broadening of the composition of growth in Canada.
Meanwhile, recent developments are in line with the Bank’s expectation of a soft landing in the housing market and stabilizing debt-to-income ratios for households. This outlook is broadly unchanged from the January Report. The effects of the higher profile for oil prices on the terms of trade and, in turn, consumption are largely offset by recent information suggesting some further delay in the pickup in exports and business investment.

By 2016, real GDP growth in Canada is anticipated to slow to closer to 2 per cent, which corresponds to the Bank’s estimate for the growth rate of potential output.

There you have it, folks. If you’re hoping for a return to boom times in Canada, know that the BoC says this IS the boom, and we can expect things to slow down a bit to “normal” in a few years. Somebody once mumbled something about “the soft prejudice of low expectations,” but, lacking a pricey speechwriter, all I can say is “bummer.”

#141 Dupcheck on 04.17.14 at 11:31 am

If a house can be build with ~150K and then sold for ~600K to 1M or so. In principle aren’t we making our own dollar weaker? Fiat money, it takes so much $$ to buy something that is not worth it. To me it looks like we are making our currency weaker. Similar to going in the store with a bag of money to buy a loaf of bread.

#142 april on 04.17.14 at 11:32 am

#125 – You are talking garbage!

#143 Penny Henny on 04.17.14 at 11:37 am

Mid April TREB sales report is out.
oh no, sales volumes are dropping. NOT.
-a 10.8 per cent year-over-year sales increase reported by Greater Toronto REALTORS® during the first two weeks of April.

you know what this means, prices are next to drop. NOT.
-The average selling price for April mid-month sales was $583,697, representing an annual increase of 11 per cent

well, those million dollar homes are sure to see some pressure. NOT.
-Detached, SFH’s in 416- $1,012,172.

See it all here-
http://www.torontorealestateboard.com/market_news/release_market_updates/news2014/nr_mid_month_0414.htm

Ricky, Carmen buy while you can. You’re Canadian now. Do the Canadian thing.

No sarcasm was used in this message.

Pity. Detached home sales in 416 so far this monthly are lower than in 2010, 2011 or 2012. But prices have soared. Risk. — Garth

#144 airhead princess on 04.17.14 at 11:42 am

Stephen Poloz..BOC Governor- Enemy of the state.

http://business.financialpost.com/2014/04/16/bank-of-canada-holds-rate-at-1/

Inflation is raging with gas , taxes, fee’s and groceries all up double digits this year. Groceries alone are all up more than 20% with transpo costs, meat supply impacted by drought and a pork pandemic……But the ultra low Canadian dollar is the real enemy of the Canadian people……adding an additional 15% on top of the cost to everything ( fresh and processed foods) Canadians consume.

Inflation is up in housing…..and manufacturing…..business is great in the oil and mining sectors ( booming actually as addressed by the stock prices) …wage inflation is soaring compared to five years ago…..immigration is stable…in – migration is stable…..we’re selling more Hydro to America than ever.

I could go on and on……so why is Mr Meat Puppet Poloz attacking the dollar…when there is no evidence of any malaise in the economy? Is this a personal attack Stephen? The moral suasion has been loud and bellicose….but there is no evidence to back your claims. And the BOC continues it’s attack of the $C dollar….why?

Seniors are starving…..ZIRP is killing the bottom line economics of this country. Is it Mr Meat Puppets task to insure that the government continues to borrow at ZIRP rates…while Canadians suffer for this brutal policy of pandering to the union elite in Ontario? Mr Poloz…..you will not restart Ontario’s economy with ZIRP rates…..only a change in government can do that….not driving down the dollar to give failing factories a temporary fix.

#145 BCD on 04.17.14 at 11:54 am

I think there is a word this blog and its disciples fail to understand. “PERSPECTIVE”. Sure, from the aged and fiscally responsible who visit this blog the world seems like a debt ridden prune, but from the perspective of the young and vibrant (with boundless enthusiasm and energy to work) there is still much fruit—and it is hanging ripe!
Life is a matter of how you look at it. Yes, people who have more equity in their car should probably not be taking out a 420K mortgage, but on the other hand who are you to play the scroogy-financial-elite and say they can’t? And by the time this argument plays out many of them will have paid off their mortgages at these historically low rates.
Speaking of mortgages, rates won’t rise significantly, they will just keep raising gas prices to make us pay more taxes. Spend away debt-lovers, as long as you can sleep at night I see no reckoning.

There is no evidence the masses are using low rates to pay off mortgages, and overwhelming evidence to suggest debt levels keep rising. Maybe your elders have seen this movie before, dude. — Garth

#146 Dupcheck on 04.17.14 at 12:00 pm

Yeah Smoking Man stick to: Real estate and financial planning.

#147 Sheane Wallace on 04.17.14 at 12:02 pm

#64 KommyKim on 04.16.14 at 10:48 pm

RE: #28 Waterloo Resident on 04.16.14 at 9:14 pm
The reason WHY interest rates will go up is precisely because the world is already bankrupt. When you loan money to someone who is broke, you want to get a higher premium for the risk you are taking,

I wish that were true. Greece just issued new 5 year bonds with a 4.75% yield. They sold like hot cakes.
……………………………

All Greek bonds were bought by ECB.
US bonds in staggering amounts bought by Belgium.
Soon they will start buying each other bonds with newly printed money while stating that they are actually reducing QE

Bond crash is coming much sooner than people think.

There are still some good investments but once gas hits 1.80…..

#148 Sheane Wallace on 04.17.14 at 12:04 pm

There is no evidence the masses are using low rates to pay off mortgages, and overwhelming evidence to suggest debt levels keep rising. Maybe your elders have seen this movie before, dude. — Garth
………………………..
Precisely.

That debt is already un-serviceable.
So default is due.

It could have 2 forms:
– outright default (ouch, the dreaded deflation), banks fail
– devaluation of currencies. Cheers to all savers.

#149 bigtown on 04.17.14 at 12:05 pm

The Hamilton mountain has a good choice of rentals at better rents than Burlington. Also homes in Hamilton can be bought for much less than Burlington. For under $200k you should be able to find a very good home in a family safe Hamilton hood.

#150 Italians love real estate on 04.17.14 at 12:05 pm

One ETF with a 60/40 split ,equity to fixed income with auto re balancing daily, which encompasses the entire financial universe of sectors, countries is all anyone would need. Wonder why it has not come about yet?

You could terminate your financial planner while watching BNN and CNBC go off the air. Oh ya the demise of every fund company an ETF provider( except for the one above of course) ..LOL

#151 Bottoms_Up on 04.17.14 at 12:17 pm

There is more student loan debt in the USA than there is Canadian mortgage debt.

#152 Smoky's OK on 04.17.14 at 12:25 pm

I have a hypothesis that Smoking Man hyper-systemizes, thereby giving an impression of talent. Hyper-systemizing is an extreme state in the empathizing–systemizing theory that classifies people based on their skills in empathizing with others versus systemizing facts about the external world. Also, the attention to detail savants is a consequence of enhanced perception or sensory hypersensitivity in these unique individuals. It has also been confirmed that some savants operate by directly accessing low-level, less-processed information that exists in all human brains but is normally unavailable to conscious awareness (his UCC). Smoking Man may have an autism spectrum disorder; he demonstrates profound and prodigious capacities or abilities far in excess of what would be considered normal. People with savant syndrome may have neurodevelopmental disorders, notably autism spectrum disorders, or brain injuries. The most dramatic examples of savant syndrome occur in individuals who score very low on IQ tests, but not always. In some very rare and extreme cases, some people with savant actually had an average to even a higher IQ while demonstrating exceptional skills or brilliance in specific areas, such as rapid calculation, art, memory, or musical ability. Perhaps we are just missing something from his UCC?

Or not!

#153 Penny Henny on 04.17.14 at 12:29 pm

Pity. Detached home sales in 416 so far this monthly are lower than in 2010, 2011 or 2012. But prices have soared. — Garth

More buyers chasing fewer listings.
How could you’ve not seen it coming?

Apparently fewer buyers chasing fewer listings. And I did. — Garth

#154 grrrrrr on 04.17.14 at 12:30 pm

Don’t think so small. Screw the washer and dryer and send all your laundry out to be washed, dried, and folded for you. That will still cost wayyyyy less than moving house and you don’t have to waste space on an ugly washing machine in your kitchen. And save hours of your time.

#155 kommykim on 04.17.14 at 12:34 pm

RE:#147 Sheane Wallace on 04.17.14 at 12:02 pm
#64 KommyKim on 04.16.14 at 10:48 pm
I wish that were true. Greece just issued new 5 year bonds with a 4.75% yield. They sold like hot cakes.
……………………………
All Greek bonds were bought by ECB

Source? Link? BS?

#156 bdy sktrn on 04.17.14 at 12:34 pm

Bond crash is coming much sooner than people think.
———————————-

what will crash, bond prices? as in rates go up? pls elaborate, thx.

#157 Bottoms_Up on 04.17.14 at 12:41 pm

#98 just some guy on 04.17.14 at 4:46 am
———————————————-
A house is not a stock and therefore shouldn’t be approached as such.

Housing prices are actually suppose to rise with inflation, so technically they should always be at an ‘all-time high’. But in reality, in inflation-adjusted terms, they should always be the same price (same affordability over the years).

But that doesn’t account for public attitude, debt load, access to money, dp requirements, interest rates, even the increasing size of houses over the years etc.

Factor all those in and house prices can skirt above the inflation-adjusted baseline.

That is not to say that ‘buying at the peak’ is not the ‘right’ thing to do.

Every individual/family is unique and has their own unique considerations. After weighing all those considerations (including house price affordability), should the (joint) decision to buy or not be made.

#158 Penny Henny on 04.17.14 at 12:44 pm

#153 Penny Henny on 04.17.14 at 12:29 pm
Pity. Detached home sales in 416 so far this monthly are lower than in 2010, 2011 or 2012. But prices have soared. — Garth

More buyers chasing fewer listings.
How could you’ve not seen it coming?

Apparently fewer buyers chasing fewer listings. And I did. — Garth

Fewer listings yes. Fewer buyers is denial. Nyet.

TREB stats. I did not make them up. — Garth

#159 Old Man on 04.17.14 at 12:46 pm

The photo caption above is a group of reformists that are about to be fed to the lions. They must repent of their sins against we the people or the door will open for a good free meal.

#160 Son of Ponzi on 04.17.14 at 12:57 pm

#44 DZ on 04.16.14 at 9:59 pm
What is this magic laundry machine you speak of, Garth? I need it!
——————
It’s a money laundering machine. Used extensively by overseas RE investors.

#161 TimV on 04.17.14 at 1:01 pm

#132 sciencemonkey: Yes, we used snap-on hoses for all our connections. The one that came with the washer/dryer worked best. There are also ones sold at hardware stores (Canadian Tire, Home Depot, etc). For the hot, we had a snap-on at both ends, since that way I could store the hose separate from the machine (since we usually washed cold-only).

With some ring clamps and other proper stuff you could probably setup your dishwasher and washer/dryer to each use the same snap-on connection, if you wanted.

#162 Andy on 04.17.14 at 1:06 pm

Check out this place:

http://beta.realtor.ca/propertyDetails.aspx?PropertyId=14192630

Terrible Investment – $1.9M on an asset that returns $98K annually. That works out to 5.4%. And it doesn’t even factor in heat, hydro, landscaping, other maintenance, property taxes, and debt service. Plus you get taxed on it! No primary residence!

Toronto RE market is WAY out of whack.

What will be the straw that breaks the camels back?

#163 bdy sktrn on 04.17.14 at 1:07 pm

Guess what we do with it? We store Tupperware in it because dishwasher suck. Use the sink guys).
————————————–
really?
you seemed like such a sensible guy until you said this!

i’m also a hard core diy guy, who’s biggest job is in the kitchen as a stay home parent, and as a mech eng i see the dishwasher as one of the true pinnacles of modern day engineering. i loooove my 12yo , slightly beaten around, whisper quiet machine and it gets run every day. i can hear a gentle hum right now while i type. use them properly and they work very well.

i truly detest hand washing dishes. it was the first fight w the wife once we moved into our house – 10 min into the fight i went out and bought one. small price to pay fo 20yrs of marital harmony.

we spend around 50 days in the summer in a cabin on a small island near vcr (boated with orcas last wknd) and there is no dw, let alone ample 120v power. 60 bucks at costco will get almost 2 summers worth of chinet, paper cups, and plastic forks saving me 40+hrs of time better spent wakeboarding, catching dungeness, snorkeling, or building something.

rob ford supports dishwashers!

in univ in my first year off campus 5 guys moved into a house, each bringing a bunch of dishes. there were so many for the first cpl months we just used up all the ‘new’ ones, as the huge pile of dirty ones grew. sometime before christmas we (i?) decided to just chuck them all in the bathtub , soak em for a while, then stir well with a hockey stick. didn’t work so well. disgusting. trashed the dishes and left a permanent stain on the tub!

#164 jess on 04.17.14 at 1:20 pm

Canada Revenue Agency expands investigations of tax shelters
http://www.thestar.com/news/gta/2014/04/17/canada_revenue_agency_expands_investigations_of_tax_shelters.html

#165 Mike T. on 04.17.14 at 1:26 pm

‘#51 will on 04.16.14 at 10:30 pm’

RE SM shut up…

the other day I posted a link to the Law of Attraction. Today it will be The Law of Allowance.

‘The Law of Allowance is the hardest law to practice. It is the law that basically allows the desired experience to manifest through thoughts, words and deeds. The Law of Allowance can be refer to as patience.’

you have to allow others to have the experience they wish to have without interference – ie. leave SM alone. If you do not wish to read or see his contributions to the (scotch fueled?) web-blog, don’t read them Adjust YOUR life, do not ask others to accommodate you. You will be pleased with the results.

I don’t go to Tim Horton’s because it is too painful to watch the slow pace of work when then line is out the door. I cannot change Tim’s, I can change what I do though…..

#166 BCD on 04.17.14 at 1:36 pm

There is no evidence the masses are using low rates to pay off mortgages, and overwhelming evidence to suggest debt levels keep rising. Maybe your elders have seen this movie before, dude. — Garth
_____________________________________

How long does the intermission of this movie last Garth? If the intermission is long enough and people just walk out of the theater does the movie ever have an ending if no one is watching? People don’t live on a circular timeline, they live on a flat one. . .and at the end of that timeline they can’t start again, they die. . .what you didn’t do in your thirties, you won’t do in your fifties, and you won’t get a chance to do over in your 60’s. . .and that sucks bigtime man. (wow. . .that’s some deep stuff. . .smoking man, you unwashed troll, pay attention).

I too have been sitting on the sidelines eating popcorn for years looking for an investment property. . .all the while watching my savings dwindle as people swallow up more and more debt and “make it happen”.

The odds are better for smoking man sobering up and entering Alcoholics Anonymous then any housing collapse in my lifetime.

http://www.theglobeandmail.com/globe-investor/personal-finance/home-cents/many-canadians-paying-off-mortgages-faster-but-are-they-further-ahead/article6475570/

#167 Aggregator on 04.17.14 at 1:43 pm

So apparently this is what a successful pre-grand opening event for new $800,000 townhomes in 416 looks like today

Dunpar Homes hosts successful pre-grand opening event for The Ossington in Toronto

It’s no surprise there was such a huge turnout over the course of the weekend — just look at the presentation centre’s stunning interior pictured below (we know, we’re imagining ourselves lounging on that rooftop terrace too)

#168 airhead princess on 04.17.14 at 1:45 pm

Civil service wages and perks ‘eating smaal town budgets alive’..

http://www.theglobeandmail.com/globe-debate/if-crime-is-plunging-why-are-police-costs-soaring/article18042954/

Since when were the civil servants supposed to form a core of the wealthiest people in town? Who is paying ( and doing without) so that an elite of coddled civic unionista’s can live large on the back of the common citizen?

As we have seen in the US…school lunches are being halved to pay for the elites wages and perks….tax are through the roof….and special benefits have to be given even when cities enter bankruptcy….bankrupt because the civil service perks and pandering is taking more than 100% of the revenues.

Isn’t it about time we set up those guillotines in the town square? During the French Revolution where similar conditions existed where an elite government bureaucracy led a lavish lifestyle while the people starved……the beheadings went on for months……from sun up to sun down….day after day……just to purge the greedy trough divers. I would pay to see that show………reserve me a front row seat……..

#169 bill on 04.17.14 at 1:48 pm

#129 TimV on 04.17.14 at 10:18 am
this is a good point Tim.
however in our apt block the humidity is very low due to extensive electric baseboard heating.
with two humidifiers going we can just get to around 35 – 40 % humidity. admittedly this is sort of odd as we live in Vancouver. it does get very dry during the rare cold spell.
turning them off allows the clothes to dry very fast indeed.
however there will be apts that are already quite humid. especially in ontario in the summer.
to each his own I reckon

#170 bdy sktrn on 04.17.14 at 1:58 pm

I don’t go to Tim Horton’s because it is too painful to watch the slow pace of work when then line is out the door. I cannot change Tim’s, I can change what I do though

——————————

true.

i see a fully automated tims able to go about 3x faster.

#171 Hawk on 04.17.14 at 1:58 pm

#166 BCD on 04.17.14 at 1:36 pm

Try Hamilton for investment property, rental returns much higher and prices lower.

#172 happity on 04.17.14 at 2:00 pm

Update on the garth USA economic renaissance…

A stunning 51%, or a majority of the reporting companies have missed Q1 revenue estimates.

Ooops…

…and profit totals exceed those of last year. The recovery continues. — Garth

#173 jess on 04.17.14 at 2:23 pm

“Senators Blumenthal (CT) and Reed (RI) have introduced the Stop Subsidizing Multi-Million Dollar Corporate Bonuses Act (S. 1476), which would finally end taxpayers’ subsidies to CEOs by closing the performance pay loophole and capping the tax deductibility of executive pay at $1 million. In the House, Rep. Lloyd Doggett (D-Texas) has introduced a companion bill, HR 3970.”

http://truth-out.org/news/item/23137-the-pays-the-thing-how-americas-ceos-are-getting-rich-off-taxpayers

===
when r > g
the more that the rate of return on capital exceeds the rate of growth of the economy, the more wealth is concentrated at the top
http://www.hup.harvard.edu/catalog.php?isbn=9780674430006
http://truth-out.org/opinion/item/23150-piketty-in-washington-how-to-reverse-the-increasing-concentration-of-wealth

#174 barose26 on 04.17.14 at 2:42 pm

Hey Garth,

Just want to say I love the blog.

I was wondering if you could direct me to which one of your books would be the best tool to educate me on building a diversified portfolio. I have about 23K invest between a LIRA/TFSA/RRSP at this point but want to sell them off and follow your plan.

Thanks.

#175 Shawn on 04.17.14 at 2:49 pm

Double Double, on the Double…

Mike T. at 165

I don’t go to Tim Horton’s because it is too painful to watch the slow pace of work when then line is out the door.

*******************************************
Really? Don’t they have any TFW like Philipino’s there?. In my experience they work super fast and are super friendly.

P.S. Buy some Tim Horton shares and then you can have a reason to enjoy the lineups.

#176 BCD on 04.17.14 at 2:49 pm

#168 airhead princess
______________________

Garth, it amazes me that you put up with people like this. “World According to Garth” is another example. I’d take our resident uber-troll Smoking Man any day.

To speak like this about sections of society (ie., that gov’t workers should be be-headed because they live high on the tax payer dollar) is as bad as spewing homophobic, misogynistic, or antisemitic nonsense.

#177 jess on 04.17.14 at 2:59 pm

…”North Dakota recently discovered piles of garbage bags containing radioactive waste dumped by oil drillers in abandoned buildings. Now, the state is trying to catch up to an oil industry that produces an estimated 27 tons of radioactive debris from wells daily. ”

http://thinkprogress.org/climate/2014/04/16/3427345/north-dakota-radioactive-waste-fracking/

#178 devore on 04.17.14 at 3:01 pm

#172 happity

Update on the garth USA economic renaissance…

A stunning 51%, or a majority of the reporting companies have missed Q1 revenue estimates.

Ooops…

Maybe they should borrow a page from the real estate pupmer handbook on bidding wars: underpromise, overdeliver. Then every company would be beating earnings estimates, and everything would be great, yes?

Estimates are estimated. Based on company guidance and analyst expectations. Being able to forecast short term business conditions is good, but long term picture is far more important. Missed estimates create terrific buying opportunities, as doomers like yourself push the sell button on non-news, while value buyers keep their eye on the real metrics that matter.

#179 funny numbers on 04.17.14 at 3:07 pm

Some of you are reading way too much into how much below asking a place sells for. Why? Because people ask insane amounts. It’s not a sign of a poor housing market. Think about it. If 1 year ago you buy a place for 500k and now you list it for 700k and have to sell for 650k. Sure it sold for 50k under list but its still a HUGE increase from where you bought it. People are listing high because the market is so hot they have a shot at people paying a stupid amount. Almost every listing is trying to overshoot the market. It doesn’t mean prices are coming down. In Calgary prices have only been going up. You don’t buy something this month, next month its 20k higher. I don’t see how that’s a downturn at all.

Average Calgary prices went up $20,000 over the last year, not the last month. More Kool-aid, cowboy? — Garth

#180 Toronto Reno Job Collapses! on 04.17.14 at 3:13 pm

Expect to see more of these horror stories surfacing …especially in those crapholes idiots are buying for $800k in Leslieville , etc.

http://toronto.ctvnews.ca/renovation-nightmare-little-italy-house-collapses-1.1780554

#181 Nemesis on 04.17.14 at 3:19 pm

#DecisionsDecisions #DoTheLaundry?OrHaveABeer? #AppliancesForBears #HallucinatoryHops

Bear Does Laundry: http://youtu.be/DT4ikdAS-P0

Beer&BrewersForBoyzOnly BondiBeachFantasy: http://youtu.be/DT4ikdAS-P0

#182 Nemesis on 04.17.14 at 3:24 pm

#LinkErratum:

Beer&BrewersBondiBeachBoyzOnly: http://youtu.be/2Z2rQOqB6a4

#183 wow comment 182 on 04.17.14 at 3:32 pm

garth amazed you can read so many comments and not go a little nuts.

anyways you might wnt to read the Two Income Trap, it’s your blog on steroids,

#184 JL on 04.17.14 at 3:47 pm

About to close on a 2 bedroom condo, good area in Calgary, older building but well maintained. Purchase price is $200,000, rents for $1500 per month.

20% down is $40,000 DP. Mortgage payment of $756.
Condo fees are $312
Taxes are $110 per month
Insurance is $20 per month
Maintenance (let’s call it $50)

Positive monthly cash flow of $250 per month. $15,000 over 5 years.

Hold for 5 years, mortgage pay down of $24,000.

Assume property value is FLAT for 5 years.

Mortgage is $136,000, sells for $200,000. Less $6000 in expenses (I have a real estate license so I save half the commission). Nets me $18,000 plus the $15,000 in positive cashflow. $33,000 on my $40,000 invested = 12.5% compound annual growth rate. Almost TWICE Garth’s 7% and that’s with FLAT prices.

Yeah, real estate investing sucks.

And btw, I do invest in the markets through RRSP and TFSA. I don’t advocate real estate instead of a liquid portfolio, I argue for BOTH.

You forgot to ascribe any value to the $40,000 down payment earning nothing for five years. You made no allowance for vacancy. And your $250 a month is taxed as income at your marginal rate, which is twice the rate on dividends or capital gains. — Garth

#185 World According To Garth on 04.17.14 at 3:48 pm

#176 BCD on 04.17.14 at 2:49 pm
#168 airhead princess
______________________

Garth, it amazes me that you put up with people like this. “World According to Garth” is another example. I’d take our resident uber-troll Smoking Man any day.
————————————————————–

As you are obviously an overpaid Govt Worker, maybe you could enlighten all the readers of this blog as to the mis-information or incorrect facts the Princess and I are presenting?

#186 Nemesis on 04.17.14 at 4:21 pm

#BonusZen #TopTenDadadisms #Number9:ExcitedAboutApplianceSales

“The future looks bright for men, more sleep, having your very own chair, letting loose on the dance floor and finding ourselves funny – it seems 38 is the age men officially lose their inhibition.” – Steve North, General Manager, UKTV Gold

[UK Independent] – Are you turning into your dad? The top ten signs you’ve embraced dad-ism

…”It’s a startling moment in any man’s life.

You’re sat on the sofa keenly scrutinising the money pages of the newspaper, looking forward to giving the lawn a good mowing and finding yourself unusually excited about an upcoming sale at B&Q, when it hits you (if you can keep your eyes open long enough): you’ve turned into your dad.”…

http://www.independent.co.uk/news/uk/home-news/are-you-turning-into-your-dad-the-top-ten-signs-youve-embraced-dadism-revealed-as-survey-says-38-is-age-men-turn-into-their-father-9267069.html

#187 jan on 04.17.14 at 4:39 pm

DELETED

#188 jan on 04.17.14 at 4:47 pm

DELETED

#189 Potemkin on 04.17.14 at 5:01 pm

MLS is very slow… hormones running high. This stupidity should end even worse, but even much later than anyone’s patience… unfortunately. A black swan event could precede it in such a way no one would ever give a damn about the housing anymore.

#190 happity on 04.17.14 at 5:11 pm

…and profit totals exceed those of last year. The recovery continues. — Garth

And there’s the rub.

To preserve the illusion of growth, that is not realized, is to use cash from operations, or incremental zero-cost leverage, to fund stock buybacks which has been stated but ignored. This is balance sheet for income statement tradeoff that creates false hope. But even the stock buyback will soon end.

#191 jan on 04.17.14 at 5:24 pm

WHY ARE YOU DELETING ME?
iT IS PEOPLE LIKE YOU THAT ARE RUINING THIS COUNTRY BY ENDLESS CENSORSHIP AND MIND CONTROL.
SHAME ON U MAN,SHAME !!!!!!!!!!!!!!!!!

You just answered the question. You’re a nutbar. — Garth

#192 Sheane Wallace on 04.17.14 at 5:25 pm

#155 kommykim
All Greek bonds were bought by ECB
Source? Link? BS?
…………………………………
Who do you think in their right mind would bind these? Did you buy them? No? I thought so. I did not either. I doubt Garth did.
Maybe I missed the deal of my life.

#193 Sheane Wallace on 04.17.14 at 5:25 pm

buy these

#194 Herb on 04.17.14 at 5:33 pm

#167 Aggregator,

I’m truly impressed by the view of the roofs from that magnificent terrace. Staggered, interlaced roof lines to get more roof and house on smaller lots! The ingenuity of developers knows no bounds, as does the stupidity of buyers.

BTW, thanks for your work. You’re an education every day.

#195 jess on 04.17.14 at 5:39 pm

Two former Anglo Irish Bank executives have been found guilty of handing out illegal loans from the financial institution whose reckless lending almost bankrupted Ireland.

Patrick Whelan and William McAteer were convicted in a Dublin court of illegally lending to the Maple 10 group of investors in the summer of 2008, in order to prop up the Anglo Irish share price and save the bank from collapse.

http://www.theguardian.com/business/2014/apr/17/former-anglo-irish-executives-found-guilty

#196 jan on 04.17.14 at 5:40 pm

DELETED.

Over & out. — Garth

#197 shawn on 04.17.14 at 5:46 pm

Sheane Wallace and Greek Bonds

#155 kommykim
All Greek bonds were bought by ECB
Source? Link? BS?
…………………………………
Who do you think in their right mind would bind these? Did you buy them? No? I thought so. I did not either. I doubt Garth did.
Maybe I missed the deal of my life.
***************************************
As expected, your source is none, it was just BS

#198 Old Man on 04.17.14 at 5:54 pm

#167 Aggregator – is that the Realtor in that picture? I am still laughing as he looks like that he just got out of jail or a rehab facility. He is a poster boy for sure, as would never do business with him or did he move down in the world from selling insurance?

#199 jess on 04.17.14 at 5:57 pm

122 sciencemonkey

…are you sure it is governments working against middle class or capitalism?

The Middle Class Is Not “Normal”
http://www.talkradionews.com/opinion/2014/04/16/middle-class-normal.html#.U1BOJ6Lhssg

#200 espressobob on 04.17.14 at 6:01 pm

#170 bdy sktrn
#175 Shawn

BMO’s ZCN owns ‘THI’. It didn’t beat the index.

http://www.timhortons.com/ca/en/about/stock.html?c=195616&p=irol-stockquote

http://www.etfs.bmo.com/bmo-etfs/performance?fundId=72048

Just saying, Not that index investing has an advantage? Unless I’m mistaken.

#201 Ralph Cramdown on 04.17.14 at 6:06 pm

#184 JL — “About to close on a 2 bedroom condo, good area in Calgary, older building but well maintained. Purchase price is $200,000, rents for $1500 per month.”

Sounds like a good one, JL. And your analysis (aside from the lack of vacancy allowance, which ought to be minor) is similar to what I do when looking at investments; if nothing changes (dividends/profits/rents don’t increase, asset prices don’t either), would this be a good investment? Any fool can justify an investment based on climbing asset values and increasing rents/profits/dividends, but it takes discipline to seek out and demand only those which don’t need a rosy scenario to pay off.

#202 T.O. Bubble Boy on 04.17.14 at 6:09 pm

@ #150 Italians love real estate on 04.17.14 at 12:05 pm
One ETF with a 60/40 split ,equity to fixed income with auto re balancing daily, which encompasses the entire financial universe of sectors, countries is all anyone would need. Wonder why it has not come about yet?

You could terminate your financial planner while watching BNN and CNBC go off the air. Oh ya the demise of every fund company an ETF provider( except for the one above of course) ..LOL
————————-

There are already companies doing this… Betterment and Wealthfront are 2 of the biggest startups.

I don’t believe that any are in Canada yet.

#203 Bobby on 04.17.14 at 6:12 pm

#184, JL, you sound just like the realtor who tried to convince me that buying a property was a great value. Just like Garth suggested, he too forgot to account for the stagnant down payment that would be earning nothing. The prospective rent was the top of the market and didn’t account for vacancies.
When I asked him why he wasn’t buying it if it was such a great deal, he responded that he got really burned in the last downturn.
Enough said!

#204 Bobby on 04.17.14 at 6:15 pm

Further for # 184 JL, only $50 a month for maintenance on an older building. That won’t even cover wear and tear.
You’re dreaming!!

#205 Ralph Cramdown on 04.17.14 at 6:16 pm

#192 Sheane Wallace — “Who do you think in their right mind would [buy Greek government bonds]? Did you buy them? No? I thought so. I did not either. I doubt Garth did. Maybe I missed the deal of my life.”

I don’t know that they’re such a great deal at last week’s offering, but I do know that if you look at a few of the top performing hedge funds in the last year, Greek government bonds are the secret sauce. My account is too puny to get reasonable pricing on anything so exotic, but I did great buying Hellenic Telecom, and many other European telecoms that were priced for TEOTWAWKI a year and two ago.

This month it’s Russia.

Understand that by the time you’re asking questions like “who in their right mind would buy that?” many smart players have already made huge money. By the time people like you think it might be safe to buy at relatively juicy yields, they’re the ones selling it to you.

#206 Just some guy on 04.17.14 at 6:34 pm

Ref Post 98 and Post 157 (just some guy and Bottoms_up)

Please be advised that I did not make the comment in post 98. I regard this as a sexist and derogatory comment as well as being a falsehood. Simply put, in this particular sandbox, someone has engaged in identity theft. As to why this person would do this, two reasons come to mind:

1. Insecurity – the person is hiding.
2. Troll – recent research indicates that internet trolls often possess the same qualities that define psychopaths. Feeding them is ill advised.

For this reason, I will no longer use this name on this site and if needs be, should the comments continue, you can verify with Garth or whomever has access to the email addresses that any use of this name in the future is not, in fact, me.

#207 HELP_us_Obi_Garth on 04.17.14 at 6:37 pm

This man (Obi_Garth) should be president of the world. The entire world, scratch that, the entire Universe would benefit if he led the world. Even God would benefit.

#208 Ralph Cramdown on 04.17.14 at 6:38 pm

#167 Aggregator — “So apparently this is what a successful pre-grand opening event for new $800,000 townhomes in 416 looks like today”

Keep up the good work, Aggregator, it’s much appreciated.

I love the marketing features in that townhouse complex:

“LUXURY FEATURES INCLUDE […] Smooth ceilings throughout” Did you ever think a day would come when the mere lack of popcorn ceilings would be considered “luxury”? Folks, that day has arrived.

“No maintenance aluminum soffits, fascia, eaves troughs, downspouts ” Only someone who’s never owned something with eavestroughs would fall for this one.

#209 wallflower on 04.17.14 at 6:39 pm

When my son was a great deal younger, his great aunt and I took him to African Lion Safari, Ontario. Because we also had the pet dog with us, we were directed toward the distant parking area with the cages for pets. We had to cage our pet while we took our self-driving tour. With my 3-year old son near the cage door, my aunt and I dealt with installing the reluctant pet dog in the cage. The door shut and self-locked. It did not appear to be possible to unlock from within. So, there we were, at African Lion Safari, inside a locked cage, me, my dog and my aunt, with a toddler walking around the cage and not a single soul in sight. There was not even a parked car in this lot. Nothing. Yikes.

#210 Ralph Cramdown on 04.17.14 at 6:45 pm

JL accounted for the downpayment. It’s the ‘I’ in his(her?) ROI calculation, which was pretty straightforward. I don’t follow the Calgary market, so I don’t know if the numbers are realistic. But assuming they are, what’s the problem?

#211 [email protected] on 04.17.14 at 6:54 pm

98 Inverdon Rd Sold: $505,500
Toronto, Ontario M9C4M1 Toronto W08 Eringate-Centennial-West Deane

List: $388,000

Orig Price: $388,000 Taxes: $3,300/2013 130 % List
SPIS: N Eringate-Centennial-West Deane 113-4-L DOM: 10 Contract: 3/7/2014 Sold: 3/18/2014
Detached Fronting On: W Rooms: 7
Bungalow Acreage: Bedrooms: 4
Dir/Cross St: Renforth/Eglinton Washrooms: 2
Lot: 49X115 Feet 1x4xMain, 1x3xLower

– tiny wee bungalow by the highway

https://goo.gl/maps/9e41A

.

#212 Ronaldo on 04.17.14 at 7:13 pm

#183 – wow comment 182 – re: the Two Income Trap

I checked it out and here is a link to an interview in this regard. Very good read and very true.

http://www.motherjones.com/politics/2004/11/two-income-trap

#213 sheane wallace on 04.17.14 at 7:34 pm

#197 shawn on 04.17.14 at 5:46 pm
Sheane Wallace and Greek Bonds

——————————-
As expected, your source is none, it was just BS
………………………………….

Not entirely.
Here are the ‘official’ buyers:
http://blogs.wsj.com/moneybeat/2014/04/11/heres-who-bought-those-greek-bonds/

Money came from Europe: 78 %.
Note lack of transparency in these sales, few funds mentioned but no allocation shown.

Do you control these funds? No? I thought so.

If you truly believe that they are good investments then I believe you have a bigger problem.

#214 sheane wallace on 04.17.14 at 7:38 pm

insurance and pensions bought 4 % of these greek bonds.

Institutional investors buying you say? Because there is value in them?

#215 sheane wallace on 04.17.14 at 7:46 pm

Here are other ‘safe heaven’ bonds that nobody wants to buy so BOJ has to step in:

http://www.cnbc.com/id/101584588

#216 Castaway on 04.17.14 at 7:56 pm

Garth – all these deletes today. Gotta be some great stuff. Shame we don’t get to read. Only you do.

#217 Castaway on 04.17.14 at 7:57 pm

After all we all need a good laugh now and then.

#218 shocked! on 04.17.14 at 7:58 pm

Interesting post! Sounds like Ricky and Carmen may have been my students…as I teach TOEFL/IELTS and Academic Prep courses in Burlington for professional newcomers to Canada. It is quite amazing how the vast majority of newcomers look to real estate as the most viable option for wealth creation…almost as soon as they land! Burlington, in particular, is fast becoming the place to buy, buy, buy! Cheap money and being rated one of the “best” cities to live in, in all of Canada no less, have fed the voracious appetite of many…not sure how this will end!

#219 };-) aka Devil's Advocate on 04.17.14 at 8:23 pm

Given all the money you might be saving by renting instead of owning why not consider, instead of the expense and space devoted to a washer and dryer, just buying a new wardrobe when the old one gets dirty. Think about it; you’ll always be current with fashion :-) 

TREB stats. I did not make them up. — Garth responding @ 158

B,b,b,b,but I thought TREB stats were manipulated and could not be trusted :-0

I know. It’s worse. — Garth

#220 LP on 04.17.14 at 8:39 pm

#208 wallflower on 04.17.14 at 6:39 pm
*************************
Aw c’mon…don’t leave us in suspense. Then what happended?

#221 ponerology on 04.17.14 at 11:07 pm

heck. You could probably pay a laundry service $45/week to wash/fold your clothes for you.
And while the savings aren’t as great as buying a portable machine, you are still saving at least $2000/month :)
After typing this I did a quick google search and found this:
http://www.laundryonwheels.ca/pricelist.html
Apparently they will even pick up and drop off your clothes for you for free.

#222 garth watcher on 04.18.14 at 12:50 am

A relative’s home in Kerrisdale area of Vancouver was listed a week ago for 2.5 million , had 13 offers and sold for 3.3 million… wait for it, … it’s a tear down. What is wrong with us people? .. this can’t possibly continue. it’s madness. I rent , and I feel alot safer than owning a home right now.

#223 wallflower on 04.18.14 at 12:54 am

Aw c’mon…don’t leave us in suspense. Then what happended? ***************

Oh, ha, funny. What happened?
We freaked out.
Freaked right out.
I scanned the territory in all directions and spotted a land maintenance person – periphery, distant. So we hollered but he did not hear us. I tried to communicate to my 3 year old that he needed to run to that distant man and point back to us. I don’t think it made any sense to him. In any event, my boy stayed close by. Quiet. The distant man disappeared behind a hill. That was sobering. And alarming. My aunt was industrious and devised something from a piece of branch on the cage bottom and started to manipulate it into the cage front to see if she could work the lock mechanism. Nope. Getting kind of sweaty nervous about the situation. Apparently no one else had brought their pet to the safari that day, meaning, no other cars would be pulling up to use the cages. I was also mentally preparing myself for the reception in case anyone did. (Pick: terror, or, humiliation. That kept me mentally engaged.) My aunt and I both just man-handled the cage door in exasperation. Nothing. A little later, she went back at it and the lock mechanism disengaged. Door open and out to my boy who had wandered somewhat. Phew. Enjoyed the remainder of the day.

In closing, I vote, “Ban Jan” – drop the DELETE and just BAN.

#224 Mehdy on 04.18.14 at 4:11 pm

Ada Colau: Spain’s anti-eviction crusader

http://www.bbc.com/news/magazine-26228300