Obsession

REMAXGAL modified

Snapped by Norman, in Toronto. (Hey, this could be a regular feature)

If you’re shopping for real estate in Nova Scotia, you have an advantage few other people do – complete and unfettered access to the detailed sales records of most properties. The local real estate board makes it available to the website/broker Viewpoint, which makes it free to you.

Sadly, elsewhere, this critical info is hidden from buyers, along with the number of days a property’s been on the market, whether or not any deals have fallen through, what the current owner paid and how many times it’s been relisted. Buyers in Mississauga or Kelowna are forced to ask a real estate agent for what little of this data is available, and then only for specific properties they identify.

Of course, you can always go to the land registry office (or pay your lawyer to do so), in order to get a complete record of what a house sold for in the past, and what kind of financing was placed against it. At least for now.

There seems to be a movement afoot to strip even this critical information from the public record. That, of course, would go hand-in-glove with the real estate industry’s current push to remove transparency from the system, as I described yesterday. Once average or median sale prices are obliterated by local boards, replaced by meaningless Frankenumber indices, most consumers will have no true picture of market conditions.

“Looks like even a public record for the price paid for a home is also going the way of the Dodo,” says an inside source in Ontario. “So much for transparency.”

Here’s what one lawyer is revealing to his realtor clients:

HIDING PURCHASE PRICE AND LAND TRANSFER TAX ON ALL CLOSING DOCUMENTS

The government has established a procedure in which land transfer taxes may be paid in advance of the closing date and in doing so, allow the solicitor on closing to register the deed as “zero consideration” and the land transfer tax payable would show as zero. In this way, the public is unable to determine the purchase price paid by the purchaser nor the land transfer tax which was payable for the transaction. I have recently had two separate occasions in which it was necessary to invoke this procedure as my investor client did not wish to have his acquisition cost a matter of public record given the plans of renovation and resale.

Call it the Flipper Strategy. If you buy a piece of junk, throw some money at it and double the price when you sell it six months later in a bidding war to an unsuspecting virgin, your lawyer can forever cover the deed.

And speaking of bidding wars, the media obsession continues. “Toronto’s real estate bidding wars are reaching a fever pitch,” reported the CBC yesterday. In fact the public broadcaster’s Toronto TV station now has a daily feature called “The Real Deal” dedicated to pumping the notion that house prices will rise forever, without end, amen.

Actually, in places like Toronto and Calgary, they will. Until they stop.

My political sources (incredibly, I still have some who are not dead) tell me the Big Owe received a stiff memo from Finance Department economists the other day when the price of a detached SFH in two of Canada’s major cities passed the $1 million mark. “That sure caught their attention,” I’m told. “Most of these guys (MPs and the Cabinet) believed Flaherty’s four mortgage rule changes were enough to let this thing cool off on its own. But now they understand the true nature of the problem.”

And what’s that?

As I detailed yesterday, it’s the banks, now increasingly aggressive to scoop up what business they can in a market where mortgage volumes have been sliding. That explains the 2.99% five-year specials. It explains the cash-back loans, the interest-only payments, the skip-a-payment plans and the “Honey, I’m pregnant” emotional blackmail YouTubes.

Naturally the real culprit here is federal mortgage insurance and CMHC, which continues to tolerate these systemic abuses. But it’s easier to blame the banks, especially if you are in the government and read stories about multiple bidders pushing the price of trashy semis into the $900,000 range.

So will Owe stop being a wuss and a caretaker Minister of Finance, and pull a F-like nasty on the lenders? All I can tell you is that he is being urged to do so. The feds don’t want a housing dump, but neither do they want to go into the next election with seven-figure homes and a population more indebted than Greece.

There are two reasons houses cost too much. Money’s too cheap and people have no discipline.

Guess which one they think they can fix?

177 comments ↓

#1 The firstest with the murstest on 04.22.14 at 7:15 pm

Awwww, yisssssssssss! FIRST!

Shoutout to Smoking Man, the conspiracy cooks, Garth’s strange sense of humour, and all the other regulars.

FIRST AGAIN BOYS! LIKE A BAWS!

#2 bill on 04.22.14 at 7:16 pm

sounds like fraud to me.

#3 TRT on 04.22.14 at 7:20 pm

Nothing happening before next election. That’s why OSFI watered down its regulations.

No interest rate hike.

No CMHC changes.

After the election, they will look concerned and further devalue our currency.

#4 gladiator on 04.22.14 at 7:20 pm

Talk about being between a rock and a hard place. Poor Owe. Damned if he stops the madness and damned if he doesn’t. For now, him being lenient will keep things from crashing, but it will just make the eventual (and certain) crash so much harder. I suspect he will pull the trigger after the elections, but for now – bidding wars galore!
Yeeehaw!

#5 Derek R on 04.22.14 at 7:24 pm

The land registry is the cornerstone of our private property system. No one should be messing with it.

#6 Jas Girn on 04.22.14 at 7:25 pm

:)

#7 Blase on 04.22.14 at 7:27 pm

I thought the OSFI cracked down on predatory lending, no? When are credit unions going to be forced to play by the same rules if they want the easy money from CMHC? And why are they called semis? Are they 18 wheelers? Can they move apart a little bit? What’s semi about them?

#8 Gobsmacked on 04.22.14 at 7:27 pm

un-fricken-believable…

#9 jimbo on 04.22.14 at 7:28 pm

People’s discipline in guessing

#10 Son of Ponzi on 04.22.14 at 7:28 pm

Check out this RE site for rich Chinese buyers

http://list.juwai.com/
—————–
Some interesting stats from this site:

Chinese property buyer facts
63.1 million Chinese have the wealth to invest in overseas property.
90 million Chinese search for property online every month.
Less than 1% of mainland Chinese can read English.
China’s property boom has gone international, with strong demand for property in Australia, UK, USA, Canada, Singapore, France, Germany, Cyprus, Malaysia, Thailand, and many more.
70% pay in cash.
Over 60% of China’s wealthy are engaged in overseas investment or immigration.
85% of China’s wealthy want to educate their children overseas.
BLOCKED: Sites not hosted in China are either blocked or experience excessively slow load times.

#11 Frustrated on 04.22.14 at 7:28 pm

Hi Garth, I noticed today that house in Mississauga that was in an auction is back on the market. I guess the deal fell threw.

#12 prairie person on 04.22.14 at 7:31 pm

Went for a drive along West Saanich outside of Victoria. Crazy number of condos and duplexes and even houses crammed into a little space a possible. All sold. People are living in them. It is like the area is jammed, crammed, and damned. Lots of sold signs along the way. More for sale signs up. Garth, you need to hire the Save On Foods arena and have a revival meeting for saving people’s souls, minds and pocket books. This is particularly crazy in the low income area of Victoria. On SS these last few days. Was told that 51% of income on the island is from pensions and investments, not jobs. Those with jobs are being paid minimum wage. There is an incredible disconnect. We need signs on every building stating how much money is owed on it. Got my credit card renewed. Didn’t ask for the debt limit to be increased but the guy on the phone said, we’ll increase your debt limit! Like he was a fundamental preacher offering to save my soul. I said no. He couldn’t understand why. It all sounds like a snake oil salesman selling his potions off the back of a wagon to the hicks.

#13 Dinner_with_Groucho on 04.22.14 at 7:37 pm

Speaking of fearmongering real estate ads like the “I’m pregnant” one

Here’s a particularly egregious classic from the US before the bubble burst.

https://www.youtube.com/watch?v=hPIxrzmatq0

Watch as the beaten down schlub of a husband is bullied into buying a house he can’t afford by his predatory harpy of a wife tag teamed with “Suzanne” the real estate thingy on the speaker phone.

#14 Zinc on 04.22.14 at 7:38 pm

What kind of sales history info do most realtors have access to?

I’ve always found the listings on “VancouverPriceDrop” pretty interesting.

#15 Doug on 04.22.14 at 7:39 pm

How about the Government gets out of the mortgage insurance business? Wind CMHC down, offer no new insurance policies immediately and wind down all coverage in 10 years. Make the banks take the risk that they ought to be taking.

#16 Calgary Owner (2nd. Round) on 04.22.14 at 7:41 pm

Hey Garth, with this new intel you gathered, do you see the Bank of Canada raising the key rate before the election of 2015? Should the VRMs be converted to fixed soon?

Thanks.

#17 Smoking Man on 04.22.14 at 7:44 pm

Isn’t human nature so predictable, yesterday chirping my butt up the Ying Yang.

The point that I try and make night after night. Human programing is the factor driving the market, not logic.

Why can’t people see thought there own programing.

Exhibit A…

I demonstrated for all that when one toots there own horn, and does it with bad spelling and grammar no need to worry about teacher coming after you, their students are more than happy to come blow your head off. They don’t know any different, they all lie and say they skip my posts, but it they did there would be nothing to chirp…

We are programed to do a good job, work hard, keep your head down, be polite, let others discover your greatness..

Well what if they f-en don’t..? Was it worth it mouse, your whole life wagging your tail, chomping on a milk bone and no one noticed you..

Why do people get so pissed at self-promotion..? Answer, it’s an emotional reaction to someone who’s had far to many year in slave training camp.

That felling re-enforced by fellow slaves, and if there’s enough of you, you think your all right. LETS MURDER SMOKING MAN..

But your wrong, not only are you a slave, your one without a voice.

I’ve make my intention clear, I’m finishing a book, a brilliant book, and building a base to try and get on the best seller list off the go.. This pathetic blog has millions of readers, sophisticated readers, who will appreciate trading secrets, delivered via a Hunter S Thomson prospective, A work of fiction, truths hidden in lies..

To get there I got be a bit nuts.. Get over it..

But you my chirpy little future fans.. You contribute nothing..
You’ve made a bet, then spend your entire time here poorly marketing it, hoping to influence others in hopes of generating enough momentum that it becomes a self fulfilling prophesy.

Will Never happen. You’re not skilled enough..

You exhibit perfect decorum, teacher taught that puts me to sleep.

I will not go quietly into the night, been here for 7 years I will continue to brag, self promote tell interesting stories, sober or hammered… And an occasional out of the park trading tip.

One way or another, you will see the light my little chirpers.

You can’t bend what you can’t offend… And you can’t get on a board of director’s chair while wagging your tail, milk bone in teeth, and waiting for some one to notice, then pat you on the head as you’ve been programmed to associate that stroke with pleasure.. The Horror..

Fools it don’t work that way in the real world. Maybe on the shop floor..

#18 kilby on 04.22.14 at 7:45 pm

Before anybody thinks that realtors are all making money by looking at their cars, remember yesterdays M3 E 46 convertible is probably a 2004 and worth about $19,000 in good shape, today’s Audi is likely a base lease model, around $450 a month to look successful….

#19 Daisy Mae on 04.22.14 at 7:50 pm

“Naturally the real culprit here is federal mortgage insurance and CMHC…”

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

Didn’t CMHC recently increase the ceiling, thus encouraging further abuse? Nah, the feds don’t want this to end…just yet. Can’t blame the banks ’cause they do what they have to do…until they’re stopped.

The ‘Big Owe’ will do as he’s told….

#20 Happity on 04.22.14 at 7:54 pm

USA economic renaissance:

When 85 million full-time private sector folks pay taxes to support the government, and 140 million Americans are receiving benefits.

#21 zee on 04.22.14 at 7:55 pm

honestly speaking, the big O will do nothing. his chances are better at being reelected with inflated debt levels supported by high prices than introducing changes and bringing down the real estate market.canadians will be upset that their house has decreased in value and not vote for harper govt.

#22 Daisy Mae on 04.22.14 at 7:57 pm

#11 Frustrated: “Hi Garth, I noticed today that house in Mississauga that was in an auction is back on the market. I guess the deal fell threw.”

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

I’m looking forward to updates! Garth will keep us informed!

#23 shane on 04.22.14 at 7:58 pm

Garth, you mention a few post back that it’s crickets for housing selling over a million is this true for the Brampton Area as well?

#24 Smartalox on 04.22.14 at 7:58 pm

So how does it all fit together?

CMHC is the lynchpin to this mess, and the rest of the usual suspects (lenders, realtors, mortgage brokers, sellers, flippers, spec-uvestors, HAM, condofloggers, the RAND corporation, etc.) are simply opportunists? Like buzzards swarming the carrion of the nation’s Greater Fools?

And if cheap, government backed insurance is the cause, what was the motivation? Was it an accidental by-product of record low rates and the liquidity injection of 2008, or has this been the result of a calculated plan to concentrate economic activity in a particular sector.

If the unaffordability of Canadian real estate was the result of a calculated plan, hindsight would suggest that it was executed truly flawlessly, with a random precison normally reserved for conspiracy theories.

If we assume it’s a calculated plan, what’s the motivation?
No tax windfalls for retirees who cash out on the equity in their properties? Most refuse to sell until it’s way past too late.

Fleecing immigrant investors for cheap loans to finance the government? Possibly, but HAM pays cash, don’t care about bidding wars, and so are unaffected by CMHC, and in fact may be net losers, as their cash pirces get driven up alongside everyone else’s.

A massive scheme to boost employment for the trades, as well as finance, insurance and real estate (FIRE) sector? Yes, unemployment is low, but Temporary Foreign workers account for a lot of those jobs too (mostly the trades, I guess, because realty is effectively unskilled labour).

#25 Observer on 04.22.14 at 7:59 pm

I would be inclined to ask anyone who drops by here claiming it’s not the government’s job to prevent “stupid”, to just take a drive on the highway and observe those white rectangular signs with the black letters saying “speed limit”…..

#26 Renter's Revenge! on 04.22.14 at 8:00 pm

@#1 firstest/murstest guy

You know what they say…

“The second commenter is the first person with a life.”

#27 Dinner_with_Groucho on 04.22.14 at 8:01 pm

#22

Who would want to pay over a million to live in Brampton?

#28 Realtor # 1 GTA on 04.22.14 at 8:03 pm

But at the end of the day they are able to service the debt
or carry the mortgage.

Like I mentioned many blogs ago I don’t see a spike in interest rates or unemployment is what usually get the RE
market

#29 Robbie on 04.22.14 at 8:03 pm

#12 Prairie Person

It’s an exaggeration to say that jobs on Salt Spring Island (SSI) are minimum wage. Yes, there are many entry level jobs at min. wage but we also have lots of teachers, ferry workers, BC Hydro workers, Telus and Shaw workers. As well, many electricians, carpenters, plumbers, excavators, septic installers, etc. who earn far more than minimum wage. Servers in our many restaurants may be paid min. wage but the tips put their remuneration far above that.

#30 Trojan House on 04.22.14 at 8:07 pm

#14 Zinc

Don’t know about BC, but here in ON, they have access to all aspects of the history of the property from the province which includes, but not limited to, who currently owns the property, what they paid for it, when the bought it, who the previous owners were, what they paid for the property and when the purchased it, the assessment value provided by the province for tax purposes (always different than an appraisal done for purchase). Plus things like the lot size, the legal description and comparable sales are also even available.

Information available to agents on the ML you-know-what system includes any listing of a particular property including previous sales, cancellations or expiries of that particular listing. It will include the listing date, the expiry date, the price, the previous list price (in the case of a price change). When a sale occurs and the property closes, the listing information will be updated with the final sale price, the closing date and days on the market.

These are the “tools” an agent will have to give them an “advantage” over a private seller or buyer since a private seller or buyer may not necessarily have access to this data.

Garth is correct when he says moving to the Home Price Index will destroy the transparency when buying or selling a home.

#31 Habs76-79 on 04.22.14 at 8:17 pm

An analogy if I may?

The Aral Sea located in Central Asia was at one time the 4th largest lake in the world. It has been shrinking for decades. It’s shrunk by about 70% of its original size as of today.

So what does this have to do with Garth’s post today?

CREA and other boards can do all they want to lie, cheat, cover up, hide, mislead, non-thinking home (er actually mortgage) shoppers into the system of obscene real estate and prices. But it does not matter in the end. Like the Aral Sea, the money supply even with it loaned out as credit with irresponsible interest rates and with all sorts of silly loopholes even unethical ones is drying up. Once the ability to further borrowing money ends as result of too few people being able to support such levels of debt, then the ride on this proverbial rollar coaster to real estate Hell will end. And end badly it will.

It’s all just a matter of time.

One more time a favourite quote for me.

The truth is incontrovertible, malice may attack it, ignorance deride it, but in the end there it is.

Winston Churchill

#32 Glen B on 04.22.14 at 8:21 pm

One Valhalla
Hi Garth. Back in 2012 you correctly indicated that Triumph (phase 3 condo tower) at “One Valhalla” in Etobicoke was iced. I have a clear view of that development and the bulldozers are back again along with shiny new signs. They must have found enough greater fools to re-activate this development.

#33 OttawaMike on 04.22.14 at 8:30 pm

Why not just use the MPAC website to look up the property value here in Ontario?

#34 HDJ on 04.22.14 at 8:39 pm

Yes, before purchasing a house I’d like to know what the seller paid. Also, I’d like to know what a store paid for the road bike, car, boat or pair of shoes they’re trying to sell me. Let’s have this sort of transparency when it comes to all purchases. Any chance of that happening?

#35 X on 04.22.14 at 8:41 pm

“That explains the 2.99% five-year specials. It explains the cash-back loans, the interest-only payments, the skip-a-payment plans and the “Honey, I’m pregnant” emotional blackmail YouTubes.” Garth

I am ok with the low rate offerings, as that will pass.

Not ok with cash back loans, unless that debt is factored in when the mortgage is issued.

Ok with interest only payments. You should be able to structure your loan as you please.

Not ok with skip a payment. Isn’t the mortgage contract a contract or an optional payment plan.

Ok with the emotional blackmail ads, I mean if you fall for that you probably have most everything from the shopping channel already too.

What I am really not ok with is as a Canadian taxpayer, paying my taxes to potentially back these loans that the banks have issued, to people with no money. I think the price for the mortgage insurance should be substantially increased, and more responsibility pushed to the banks, not the tax payer. Or are they too big to risk failing.

I am sure increasing the downpayments to 10% down would crush the RE market, but it is probably the right thing to do to protect the public from themselves.

#36 Andrewski on 04.22.14 at 8:42 pm

I fly to Mississauga on Thursday to visit my parents who live a block away, so I can update 2290 Saxony CRT for those who care.

#37 Blobby on 04.22.14 at 8:45 pm

“but neither do they want to go into the next election with seven-figure homes and a population more indebted than Greece.”

Hmm.. But maybe they do?

Canadians seem to equate debt as wealth (for some reason I fail to understand). This is especially true in some areas of vancouver (yaletown/west van), where people will happily brag about how much debt they’re in (as if it’s a symbol of wealth).

So all this debt is probably seen as a positive to most people (why else are they lapping up mortgages?). Any attempts to fix this before the election might be seen as being a negative to some folk (how DARE you restrict what i can “afford”?).

Far better to leave it after the election.. At least then if the tories dont get back in – they can blame the mess on the next guys.

#38 bobbo on 04.22.14 at 8:48 pm

smoking man

re: Why do people get so pissed at self-promotion..?

do it somewhere else. like your own blog instead of riding the coat tails of another, i.e. this one

it gets a little tiresome to hear who great you are and how everyone else is a slave to the system but you

sheeesh

get a life somewhere else

#39 Ret on 04.22.14 at 8:55 pm

How will the , “Flipper Strategy” affect the CRA’s determination of taxes owing on the profits from flipped properties? Will the Property Registry Branch be keeping two sets of records and who will get access to the real records?

Why are the Liberals in Ontario allowing this? Who are they trying to curry support from with this stunt? So much for transparency.

Methinks that powerful RE interests will somehow game this strategy for big dollars.

#40 Obvious Truth on 04.22.14 at 8:55 pm

Always said it was the banks. They control the money. Can’t help themselves. Every time I talk to them they want to loan money for RE.

They look at me like I’m retarded when I don’t want to buy anything other than equities on sale. They call it risky. And makes them no money. The whole country is on the same side of the trade with way more margin Han they should be allowed to carry. If we keep heading up nobody has to make the call.

#41 Happy Renting on 04.22.14 at 8:58 pm

“My political sources (incredibly, I still have some who are not dead)”

:) I’m sure you have friends everywhere, Garth. Either they value your honesty and good intentions, or they find it useful to have you shake things up from time to time.

—————

#18 kilby on 04.22.14 at 7:45 pm

Good point. Maybe the autos are aimed at house hunters who don’t know cars and/or don’t realize most things can be leased to give the illusion of wealth and success that doesn’t exist.

—————

#11 Frustrated on 04.22.14 at 7:28 pm

Yes! Would love an update post on the Faux Chateau! Interesting to hear the sale fell through (or the owner now feels the need or desire to sell…)

#42 James on 04.22.14 at 9:01 pm

#29 Robbie

Okay, so Saltspring has some teachers, ferry workers and the like. I’m sure Victoria does as well.

You are telling me that their incomes are sufficient to account for housing costs out there? Sorry, it still looks unaffordable to me, and when the only people earning decent wages are public servants, you know there is trouble brewing.

#43 Trojan House on 04.22.14 at 9:03 pm

#33 OttawaMike

The MPAC assessment is for property tax purposes only. It is generally much less than the current market value of a home. In my own case for example, the MPAC assessment is about $85,000 less than market value of my home.

#44 Musty Basement Dweller on 04.22.14 at 9:08 pm

Most places in the U.S. have the Real Estate transparency with selling history that only Nova Scotia has in Canada.

I wonder how long the Real Estate Agent Cartel can get away with this in Canada? Maybe till the next price meltdown and a few more people wake up?

#45 Cici on 04.22.14 at 9:08 pm

Stripping such critical information from the private record has everything to do with money laundering and specuvestor fraud.
Funny, many flippers are also RE agents.

But, this will eventually blow in their faces, and hopefully sooner than later, when it will do irremedial damage to the economy.

#46 will on 04.22.14 at 9:10 pm

How about this for a theory: at the end of the financial crisis, Canadian banks were far more exposed to CDOs than anyone knows (except TD), and we had to have all this debt indenture to get the banks books balanced? Make sense?

#47 stevie on 04.22.14 at 9:11 pm

Garth,

I would like to get your take on duplexes, tri and fourplexes. What advice can you give?

#48 Inglorious Investor on 04.22.14 at 9:13 pm

Whatever the government does, it will only make things even worse. We need a return to actual free market capitalism. Not that we ever really had true free markets in this country, but we should have learned long ago that big government, Marxist, central planning does NOT work. Governments should NOT be involved in ‘managing’ the economy. They should simply enforce rules (i.e. the rule of law) that allows markets to function fairly. But too many people today are so deeply buried in the idea of big government that free market capitalism is as alien to them as the third dimension is to the inhabitants of Flatland. Sadly, the entire system will have to collapse before real, positive change can occur, I think. In the meantime, they’ll be coming for everything you got.

#49 sheane wallace on 04.22.14 at 9:19 pm

#3 TRT on 04.22.14 at 7:20 pm
Nothing happening before next election. That’s why OSFI watered down its regulations.
No interest rate hike.
No CMHC changes.
After the election, they will look concerned and further devalue our currency
…………………

no, the currency would be/is already devaluead gradually. it could be literally destroyed/become sh.t currency.

I see food prices already crippling.

no other country has mortgage insurance at all not to speak of the artificial and miss-priced risk.

just dismantle CMHC.

#50 Pope Sexballoon Snugglebums the 666pm (aka Nosty) on 04.22.14 at 9:22 pm

#5 Derek R on 04.22.14 at 7:24 pm — “The land registry is the cornerstone of our private property system. No one should be messing with it.”

Possibly, except next door the EPA appears to hold a different view.

#51 sheane wallace on 04.22.14 at 9:27 pm

p.s. the gold might not literally soar, but the currencies would be destroyed so the gold price like everything else will increase.

it might be already too late to prevent the currency crash. it is clear that pick debt can not be served from now on and for the economy there would be no other way to ‘grow’ other then burning through the savings of the retirees/prudent.

but with destruction of capital we could become third world country. There would be the rich but almost no middle class. being poor in a country rich of resources is stupid but we could achieve it.

my personal pick is energy play and BRICS service sector.

#52 sheane wallace on 04.22.14 at 9:28 pm

peak debt, darn spellchecker.

#53 TheCatFoodLady on 04.22.14 at 9:33 pm

In our early to mid twenties, we may feel we’ve got life figured out but the truth is, we’re still finding our way. In doing so, we make mistakes – LOTS of mistakes. If we’re maturing at a reasonable rate, we learn from those mistakes; we don’t repeat them.

Until fairly recently, it was hard to really burn ourselves financially. Oh, if you tried hard enough you could find ways but most of us couldn’t get credit. Our mistakes tended to be limited to cars that looked great & needed a lot of work & pricy parts. Maybe we rented the wrong apartment – hell, we probably all did at least once. We churned through boyfriends & girlfriends. We tried different careers. Some of us did all of that |& then some!

What we didn’t do was potentially make a huge mistake that doomed us to fiscal servitude for a long time. We didn’t buy too buy, too fancy houses in tight, frothy markets with staggering amounts of debt & huge service costs – many of which we didn’t appreciate until our pockets routinely held nothing but lint.

Who knows why the young are jumping with both feet, blindfolded into the housing market. I still think many associate home ownership with security & with maturity. Their parents may be pushing them & encouraging them with gifted down payments. The banks, mortgage brokers & agents make it seem stupid not to buy.

Our species is known for individual genius but as a group, we’ve always been pretty dumb, pretty complacent. It’s easier to go with the flow. If the flow means surfing the housing wave – everybody buys board shorts.

I routinely talk to ‘kids’ who won’t leave the area for jobs. “It’s too risky. What if I get fired? I don’t know anyone? Where will I live? I’ll miss my friends, my mom. I won’t be comfortable.” And wasting years un or underemployed is not a huge risk? Seriously?

I love houses – call me a housing whore. I read the glossy brochures, look at house plans, look at homes when I walk. I’d love to be in a position to own – never will be at this stage. I could be happy a number of styles. Finishes that aren’t stylish or spendy – meh! Give me genuinely good bones.

My rental apartment is okay – has all we need. We aren’t forced to live in it, mewed up with cheap 70s finishes that we can’t escape. I live in my garden, the woods, swamps & fields in the spring/summer/fall. I walk, bike, bird watch & even though The Main Squeeze is disabled, he’s not cooped up most of the year either. He was raised in a house the family owned. I was in various rentals until I was 13. I never felt deprived – it was the norm to rent until you could afford the proper down payment.

Renters, (most), aren’t losers. They’re not living in ‘coffins’. Everybody has to find the situation that works best for their own situation. We have plenty of owners right here, well positioned to own, maintain what they own & still look after their retirement & other life priorities. Owners are no more ‘suckers’ than renters are losers. Some are – increasingly the young with currently poor prospects for job advancement or security.

All I know is if I was entering high school right now, I’d sure do things differently. It’s an ever changing world. I don’t have to wait until I find a career I looooove. I’d rather find a solid career that’s challenging & mainly enjoyable; that’s portable & flexible.

I’d do a hell of a lot more travelling too – hence the portability of a career choice.

But… here we are – many people in a huge mess they don’t even know they happen to be in.

Now, we have to protect our own interests in the face of so much irrationality, try our best to make sure our children learn the right lessons & try to be examples of prudence. If we can do that & still convey that life is a hell of a lot of fun, even on a budget, one person at a time… we can help.

#54 Smoking Man on 04.22.14 at 9:34 pm

#38 bobbo on 04.22.14 at 8:48 pmit gets a little tiresome to hear who great you are and how everyone else is a slave to the system but you

sheees

get a life somewhere else
……………….
Zoom……. My lesson flew right over your head. You just admitted to a million people that you have no chance of splitting an atom..

Copy and paste this to Word, in the near future when my book is selling in the tens of millions of
copies that the great Smoking Man actually talked to me..

You can proudly share this dialog with your grand kids.

I did know the Smoking Man…

#55 wallflower on 04.22.14 at 9:36 pm

Tremendous metaphor:
a safe deposit box in the sky

http://www.livablecities.org/articles/preventing-global-condo-bubble-collapse-and-slowing-inequity

#56 Roy on 04.22.14 at 9:42 pm

Lets see where Canada is going

Skilled immigrants to be offered ‘express entry’ to Canada in 2015
http://www.cbc.ca/news/politics/skilled-immigrants-to-be-offered-express-entry-to-canada-in-2015-1.2617961

So the Express Entry program replaces the TFW program where the employer pays with one that is federally-funded and the Canadian taxpayer pays

In other words Canadians now get to pay to be displaced, removed, or outsourced from their own work force.

Hard to get excited about real estate when your country is being destroyed

but people here worship granite and love being slaves to big banks and dead end jobs where employers and the government could care less about them or the middle class

#57 the jaguar on 04.22.14 at 9:43 pm

#43 Trojan Horse.
I can attest to the fact that in many cases the assessment value of a house can be higher than the actual market value.
The chickens come home to roost when the appraisal is completed.
People overstate the value of their homes just like men overstate the …….well,….you know how to finish the sentence…

Horsepower? — Garth

#58 End CHMC on 04.22.14 at 9:46 pm

The Spend spend spend conservative governments needs to End CHMC. It’s obvious that these spend spend spend conservatives want to bankrupt Canada as almost a TRILLION dollars in sub-prime mortgages have been backed by the taxpayer. Why not allow the free markets to work. END CHMC

#59 Stupesing in Cabbagetown on 04.22.14 at 9:53 pm

#31 Habs76-79 on 04.22.14 at 8:17 pm – the drying-up of the Aral Sea is a man made disaster. An interesting documentary on this very sad situation can be viewed on Al Jazeera World at http://aje.me/MYtWZU

#60 Roman on 04.22.14 at 9:54 pm

Canadians are collective Chuck Norris.

#61 sheane wallace on 04.22.14 at 9:57 pm

We live in times when governments fail to be responsible and tend to punish prudent at the expense of the reckless.

One of the features of democracy is ability to limit the governments in the damages they could cause. So we are clearly not a democracy.

People are NOT obligated to follow rules in societies hat screw them, nobody will dig volunteer his/her own grave fast and in clear mind because the ‘society’ said so. Watch hunger games.

#62 Sean on 04.22.14 at 10:05 pm

#27 Dinner_with_Groucho on 04.22.14 at 8:01 pm
#22

Who would want to pay over a million to live in Brampton?

———–

Exactly, right! I remember talking with my mother in law, circa 2007, Calgary.. actually pretty much the height of their bubble, though they don’t seem to know it yet. She was pointing out a lot.. “worth at least a million, as a knock down”.. 50 by 100, mind you. And I’m saying, if you have a million for a lot, why the F are you still in cowtown? Didn’t help that the weather was apocalyptic… -35 and snow falling horizontally…

#63 Nemesis on 04.22.14 at 10:10 pm

#OldiesButGoodies #TheMummyRodeShotGun #TalesFromTheCrypt

[DailyBeast] – The Mummy Rode Shotgun

…”For 10 months, a real estate agent drove around Southern California with the body of a woman in her car. Christine Pelisek investigates a mystifying and macabre case.”…

http://www.thedailybeast.com/articles/2010/10/31/california-corpse-mystery-the-mummy-rode-shotgun.html

#Denouement

http://articles.latimes.com/2010/oct/28/local/la-me-mummy-20101028

[NoteToSaltyDogz: Either the OpenHouses were getting a little lonely… or it had something to do with HOV lanes. You decide.]

#64 just an observation on 04.22.14 at 10:17 pm

#57 the jaguar on 04.22.14 at 9:43 pm
#43 Trojan Horse.
I can attest to the fact that in many cases the assessment value of a house can be higher than the actual market value.
The chickens come home to roost when the appraisal is completed.
People overstate the value of their homes just like men overstate the …….well,….you know how to finish the sentence…

Horsepower? — Garth

hahahahahahahahahhahhahahahahhhhhahahaha…funny

#65 just an observation on 04.22.14 at 10:18 pm

#58 End CHMC on 04.22.14 at 9:46 pm
The Spend spend spend conservative governments needs to End CHMC. It’s obvious that these spend spend spend conservatives want to bankrupt Canada as almost a TRILLION dollars in sub-prime mortgages have been backed by the taxpayer. Why not allow the free markets to work. END CHMC

Me – because Canada is not a capitalist economy country.

#66 Sebee on 04.22.14 at 10:19 pm

Doesn’t Canada have consumer protection agencies?

Isn’t a home a thing you buy?

If this info being watered down or withheld, isn’t that an anti – consumer practice?

What are these government consumer agencies so busy with?

Shouldn’t the biggest purchase most people will make be a priority for them?

I know…too many stupid questions.

#67 Yuus bin Haad on 04.22.14 at 10:23 pm

F will get the last laugh.

#68 Babblemaster on 04.22.14 at 10:25 pm

Regarding smoking man, I’m starting to become a fan. Not in a fawning, obsequious sort of way regarding his supposed greatness, but respectful of his views. He speaks very candidly about a lot of truths in this society that others just don’t see. Not only do they not see, they refuse to see. And, they react very aggressively when a smoking man speaks these truths.

Regarding RE prices, SM was absolutely spot on about the upward trajectory of SFH prices.

#69 Tripp on 04.22.14 at 10:26 pm

We’re the richest, at least on the paper.

http://www.theatlantic.com/business/archive/2014/04/how-did-canadas-middle-class-get-so-rich/361053/

#70 8102 on 04.22.14 at 10:32 pm

The Conservatives are focused on re-election right now, they will do what they need to do to contain this mess until after the election, they will not introduce another crisis. They already have enough scandal and bad policy to deal with, after the election – look-out.

#71 will on 04.22.14 at 10:33 pm

to cat food lady #53: nicely put. love ya.

#72 Spectacle on 04.22.14 at 10:35 pm

Thanks Garth, & big thanks for yesterday’s patient nice with bloggers!

#50 Pope Sexballoon Snugglebums the 666pm (aka Nosty) on 04.22.14 at 9:22 pm
#5 Derek R on 04.22.14 at 7:24 pm — “The land registry is the cornerstone of our private property system. No one should be messing with it.”

Possibly, except next door the EPA appears to hold a different view.

My reply:
Thank You so much Nosty. The agenda-21 is the largest destructive force in our economy and society. Thanks for providing important relative information about the EPA; this land grab, control of all property. If you follow the money as it drains from your pockets, you can see how devastating the outcome will be.

I think some of the dormers would be more effective if they made their points on here relative to the UN Agenda-21 and it’s horrible, devastating effects.

Do your research.

Regards

#73 Anonymous from Sask on 04.22.14 at 10:38 pm

The level of inflated sense of entitlement in this country is getting fever pitched. I encountered a lot of people who have no business of owning a half a million dollar homes desiring it and getting it. I don’t know what’s wrong with the bank and the swan song that its different here.

It is worst here in “flat lands.” People here think that the demand of housing here will continue to rise because this province is booming. I have many friends who are earning >100K a year and still they feel that they are poor. Sadly we already lost our ways here and it will take generation for us to repay this mistake.

We Canadians are criticizing the Americans for their mistake but we are doing the very same thing. Yes the dynamics are different here, but the principle are very very much the same. Debt still a debt, bubble still a bubble, and correction will happen as part of the market forces that govern the economics rules for centuries. It ain’t no different here.

Don’t expect a different result doing the same thing.

#74 Joe on 04.22.14 at 10:38 pm

Nothing is going to change from the tactics used down south to inflate the housing market, pre crash.

Perhaps it will be packaged differently but the banks and lending institutions will use every means possible to ensnare the public.

The same endgame but I guess the one positive thing is that people will be able to lock in a low rate on a overpriced home when they rise..

A definition of insane is when people expect different results from the same actions.

Or, history repeats itself.

#75 sheane wallace on 04.22.14 at 10:43 pm

#56 Roy
……………..
Wow, Steve smart boy.

congrats folks.
so far we are:
– peak indebted
– with depleted savings
– no work out of university
what is coming:
– paid healthcare
– non-retirement, un-retirement
– work crappy jobs if lucky until in diaper but for sure no benefits until 75.

We CONservatives love Canada!
Wow!

#76 Pope Socked In Snugglebums the 666qt (aka Nosty) on 04.22.14 at 10:51 pm

SMan and others — Latest on MH370. “WHAT IF THE DISAPPEARANCE OF MH 370 IS SUCH THAT IF THE TRUTH BE KNOWN AS TO HOW IT HAPPENED IT WOULD NOT ONLY BE A SECURITY ISSUE, IT WOULD ALSO HAVE A GLOBAL IMPACT ON THE WORLD’S ECONOMY. ‘THINGS’ (USED IN A BROAD SENSE, AND SO YOU HAVE TO THINK WHAT ‘THINGS’ THAT) WOULD COME TO A COMPLETE HALT, ALMOST A COMPLETE SHUT DOWN.”

#77 flipflop on 04.22.14 at 11:09 pm

We bought a house a house in Bloor West only to find out the entire street was landfill in the 50’s. The backyard was littered with garbage at 1 meter depth.

Soil testing and sampling should be standard practice and knowledge.

#78 BCD on 04.22.14 at 11:14 pm

As in life. . .this housing bubble is all a matter of perspective.

Watch this:
https://www.youtube.com/watch?v=ei0FpwI1dqg

Then read this:
http://www.vagabondjourney.com/zhengzhou-zhengdong-china-largest-ghost-city/

Renters keep hoping for a crash that will never come. . .reality is larger then your Vancouver, or Toronto. Real estate is a global game and there is more money than you can imagine, with cheap credit and no end in sight.

#79 Aggregator on 04.22.14 at 11:20 pm

#66 Sebee

Doesn’t Canada have consumer protection agencies?

It used to be one of OSFI's mandate, until it was removed in the early 1990s (thanks to bank lobbying). Now we have the Financial Consumer Agency of Canada (FCAC), which is probably nothing more then some office in Ottawa with a dozen employees that tweet 'watch out for fraud' all day long.

Canada is finished. Banks (OSFI), corrupt officials and oligarchs control and dictate everything, and history shows that when overvalued economies become monopolistic, the easiest and most likely way for governments to deflate wages and housing in order restore competitiveness is by debauching the currency combined with mass immigration.

Smart money understands what macroprudential policies means and how it will be used to confiscate their wealth if they keep their assets in Canada. That's why they're leaving, and why big money and top talent will never come to Canada.

#80 VillageIdiot on 04.22.14 at 11:21 pm

For values of BC Properties – http://www.propertyinsight.ca

#81 Andrew Woburn on 04.22.14 at 11:25 pm

The American Middle Class Is No Longer the World’s Richest

http://www.nytimes.com/2014/04/23/upshot/the-american-middle-class-is-no-longer-the-worlds-richest.html?hp&_r=0

#82 Spectacle on 04.22.14 at 11:27 pm

Regards All, & Garth & Team.

Some supporting detail for the destructive force Agenda-21, for those interested:

“As anti-U.N. Agenda 21 activist Rosa Koire says, ‘It is the blueprint, it is the action plan, to inventory and control all land, all water, all plants, all minerals, all construction, all animals, all means of production, all energy, all information and all the human beings in the world. It is a completely comprehensive plan, it’s global and it’s implemented locally… It is in every single town all across the United States and across the world.”

Re: #59 Stupesing in Cabbagetown on 04.22.14 at 9:53 pm
#31 Habs76-79 on 04.22.14 at 8:17 pm – the drying-up of the Aral Sea is a man made disaster. An interesting documentary on this very sad situation can be viewed on Al Jazeera World at http://aje.me/MYtWZU

Big Thanks for the links guys. As a Garth noted last blog, it’s important to take a bigger understanding of the “picture” at times. Another man made disaster……… Van city banking, toxic real-estate, ……wage decreased lately?

#83 OttawaMike on 04.22.14 at 11:28 pm

43 Trojan House on 04.22.14 at 9:03 pm

True but MPAC also has on file the last sold price. You need a subscription if you want to see more than 25 properties in detail.

#84 Waterloo Resident on 04.22.14 at 11:32 pm

YOU CAN’T FIX STUPID.

Have you ever seen anyone trying to chug down 20 gallons of hard alcohol? You know that if they get even half way to their goal they will literally die from alcohol poisoning. But you don’t dare try to stop them because it would end up in a fist-fight, so the drinking goes on.

Well, with Canada, the debt orgy goes on. We know what will soon follow.

#85 Dawna Werbeski on 04.22.14 at 11:49 pm

Garth, some really interesting numbers would be to calculate what people will actually pay for some of these example house purchases, just mortgage, and interest. Most people would never want to pay what they will actually put out if they did those numbers. Likely you don’t even have to include things like taxes and maintanence. Goodness don’t include renos! No one ever factors those things in anyway. Especially in loose discussion about how much they made on a sale. People would be shocked if they just did the math on interest alone. Really, they truly are only renting, as the banks actually own these properties. It used to be, if someone asked if a person owned their home, it meant, have they paid off the mortgage.

#86 Racket (crime) From Wikipedia, the free encyclopedia on 04.22.14 at 11:58 pm

A racket is a service that is fraudulently offered to solve a problem, such as for a problem that does not actually exist, will not be affected, or would not otherwise exist. Conducting a racket is racketeering.[1] Particularly, the potential problem may be caused by the same party that offers to solve it, although that fact may be concealed, with the specific intent to engender continual patronage for this party. A prototype is the protection racket, wherein a person or group indicates that they could protect a store from potential damage, damage that the same person or group would otherwise inflict, while the correlation of threat and protection may be more or less deniably veiled, distinguishing it from the more direct act of extortion.
Racketeering is often associated with organized crime, and the term was coined by the Employers’ Association of Chicago in June 1927 in a statement about the influence of organized crime in the Teamsters union.[2]

#87 Stop the Conservatives on 04.23.14 at 12:04 am

The Conservatives are at it again . It’s amazing how George Orwell could see the future. Conservatives fair elections act is just the opposite . Stop Harper before it’s to late. http://www.huffingtonpost.ca/terezia-farkas/fair-elections-act_b_5143037.html

#88 Sheane Wallace on 04.23.14 at 12:10 am

Where is the Canadian equivalent of this article:

http://davidstockmanscontracorner.com/chronicling-the-feds-follies-americas-housing-fiasco-is-on-you-alan-greenspan/

Garth, any thoughts?

#89 Robert on 04.23.14 at 12:24 am

It’s clear what Owe will do, repeat the St. F strategy and buy Stephen another majority using CMHC insured funds to inflate the bubble one last time. If the sheeple fall for it, the s–t will hit the fan immediately after the election is over. If the Cons win, they’ll blame the world economy and entitlement programmes for the mess then slash social spending. If the Lib/Dem’s are in, then the Cons won’t give a rats a-s because it won’t be their mess to clean up. They’ll be plotting to take the following election afterward due to the Lib/Dem’s “mismanagement” of St. F’s divine plans for our economy. Ouch.

#90 Anonymous lawyer on 04.23.14 at 12:28 am

It’s not a new thing. When I first started practicing in the 90s that land transfer tax trick was common practice for wealthy clients who didn’t want the value of their Forest Hill mansions to be public knowledge.

#91 Son of Smoking Man - Steve French on 04.23.14 at 12:43 am

“The rich rules over the poor, and the borrower is the slave of the lender.”

– Proverbs 22:7

#92 Chris on 04.23.14 at 12:46 am

In the US, appraisal, property tax, sales and other property details information are readily available to everyone on the county appraiser’s website. All you need to do is type in the property address and there it is. Why is Canada so backward in this regard. Information is the ultimate weapon and should be available to everyone.

#93 CrazyIdea on 04.23.14 at 12:57 am

Crazy idea Garth, but maybe it’s time you STOP recommending the use or a Realturd and start pushing FSBO??

#94 Turtle on 04.23.14 at 1:07 am

#57 the jaguar

People overstate the value of their homes just like men overstate the ……

===========

Hockey?

#95 victoire on 04.23.14 at 1:16 am

Awesome. 5 more years of music chair. Then followed by 5 years of potential price decline. Oh wait mortgage paid off by then.

Continue to wait folks. What is another 10years ?

#96 John on 04.23.14 at 1:29 am

I don’t frequent this site often due to Smoking Mans lecturing rants only to visit tonight. I see he’s on his game as always. I’ll check back in a couple of months.
No comment is necessary SM.. but if you must.. let me have it..

#97 Dr. Wu on 04.23.14 at 1:54 am

there’s people here who think the government should be a data, statistics dispensing service for parties uninvolved in the transactions. People, wake up, it’s none of your business. Does the Toyota dealer tell you what your neighbor paid? No. Mind your own business.
The government is so interested in what people pay that they outsource all data work. The market is a Grand Bazaar, the principals are entitled to privacy.

#98 jp on 04.23.14 at 2:23 am

You hit the nail on the head Garth.

You can’t blame the banks. They are only doing their jobs.

They whole reason why this is happening is CMHC.
The banks are simply gambling in the Real Estate Casino with the tax payers money. No Risk, No big Deal , the more mortgages they sell the more money they keep. And leave the Risk on the Taxpayers

Ask yourself one thing. Are we better than the USA when they collapse or are we in worst shape. At lease Leeman’s died. But there is absolutely no risk on the preditory lenders (THE BANKS) so they will never fail.

But how is the already broke tax payers going to pay for it all?

#99 Freedom First on 04.23.14 at 2:36 am

Garth, your post today “Obsession” really captures the housing mania taking place in Canada and the epic manipulation by the co-conspirators intent on fleecing the Canadian people with merciless abandon. There will be blood.

Being a student of global history, recent and written, I liken what has been going on with the fleecing of the masses throughout time, with a phrase I made up years ago. Think of-business/the economy-like you would a board game with game being called- “Take Away”, and where the losers are the ones who are roped into going into debt to finance their lifestyle, and then, by numerous types of “unseen events”, the losers are unable to continue to finance their mortgaged lifestyle. The winners/manipulators, etc., of course are the ones who walk away with all of the assets purchased using debt, plus everything else from the losers.

Garth is teaching the financial principles that have been passed down by the wisest financial advisers throughout history, including the wisest one who ever lived. The message is simple. Diversify, buy different assets, buy many different assets, as nobody knows the future and what is going to happen. With this message, throughout history, is another message, “Ignore this advice, and you are a fool”. No exception.

#100 Jane24 on 04.23.14 at 4:06 am

Yes that is the bit that I don’t get, the way that many younger Canadians associate debt with wealth. They will say I live in a million dollar house but don’t seem to understand that they only own 1/10 of it. Then they match it with a million dollar lifestyle – all on credit.

From your photo Garth, the other thing that I don’t understand is why German family cars such a Mercedes and Audi seem to be considered luxury brands by such people. Here in England they are priced at not much more than top end Fords and the same as Toyota.

I had $30,000 cash to spend on a gently used 4×4 car last weekend for our trips to France and Italy and had the choice of a Mercedes B Class, a VW Tiguan, a Mazda C5 or an Audi Q3. All the same price. I took the VW as a nicer ride. These German ordinary family cars must be making a fortune in Canada by positioning themselves as luxury. Luxury is a Bentley or Jag.

#101 West Coast on 04.23.14 at 5:01 am

http://www.theguardian.com/world/2014/feb/28/home-ownership-greece-property-market

Greetings from the land where homeownership stands at 87%. Remember that childhood game of ‘musical chairs’? Well over here the music has stopped. Click on the link to see how the realtors are reacting!

#102 Harbour on 04.23.14 at 6:49 am

#79 victoire on 04.23.14 at 1:16 am
Awesome. 5 more years of music chair. Then followed by 5 years of potential price decline. Oh wait mortgage paid off by then.

Continue to wait folks. What is another 10years ?
……………………………………………………………………..

Oh wait… I paid more in interest and principal than the damn house is now worth.

Continue to wait folks.

#103 Bob Rice on 04.23.14 at 7:10 am

” but neither do they want to go into the next election with seven-figure homes and a population more indebted than Greece.” – G. Turner

Canadians might wish they have the Greeks personal debt levels some day soon! As bad as the Southern European economies are right now, they have not taken on the silly personal debt that Cdns have.. In Italy for instance, despite a stagnant economy (although it’s showing signs of improvement), Italians are still very good savers. And they owe only .80 cents for every dollar earned.

Anyhow, must be this miserable climate and mediocre/overrated lifestyle we have in this country… We freeze to death for most of the year and are trapped in our homes… guess that explains why millions of people who can afford it get they hell out of here as soon as they get a chance to vacation.

#104 OttawaMike on 04.23.14 at 7:52 am

Garth Turnerwitz is beating the warning drums in this article about a Tel Aviv housing bubble and the influence of offshore money:

http://www.bloomberg.com/news/2014-04-23/tel-aviv-price-boom-tests-local-borrowers-limits-mortgages.html

Good thing Canadian cities are not seeing any influx of foreign buyers. Right Garth?

Foreign buyers are not responsible for $900,000 semis in Toronto or million-dollar Vancouver specials. We did that. — Garth

#105 Herb on 04.23.14 at 8:00 am

“You can’t bend what you can’t offend…” (SM @ #17)

and that’s your trouble, tootsie.

#106 Herb on 04.23.14 at 8:14 am

#43 Trojan Horse,

MPAC’s “current value assessment” is based on the sales history of the property and neighbourhood comparables, as well as the value developed for factors such as size, rooms, location, condition, etc. “Market value” is based on what an owner thinks his place is worth, and what a real estate salesperson thinks it can get (even if only to get the listing).

Which do you suppose is more objective?

#107 Holy Crap Wheres The Tylenol on 04.23.14 at 8:44 am

Above captured photo.
As I mentioned yesterday they all drive high end cars. So there is definitely money in the industry, or is there?
Nahhhhh, ten bucks says these agents are all driving leased cars. That would be the prudent thing to do 100% write off at tax time. Wonderlust!
I wonder what Smoking Man drives? He has to be a RE agent in disguise!

#108 TheCatFoodLady on 04.23.14 at 8:54 am

I’m scratching my head over the ‘high end finishes’ mania I’m increasingly seeing. More & more home buyers, especially the younger ones, speak of buying their ‘starter home’ or eventually ‘moving up the housing ladder’. So they mortgage their souls & unborn children to buy a property with hardwood, granite, quartz, stainless steel, etc. or if they reno’ing, promptly buy all of that.

That makes no sense if they’re not planning to stay that long. What’s even more senseless is many put in finishes they’re not even sure they like because… they’re cool, they’re ‘in’.

Last week I was in a hardware/home finishes store killing time. The prices on the high end stuff got me all twitchy. If some home buyers really like the look of granite & other finishes & don’t plan to be in their homes that long or don’t want to be totally destitute, why not look at some of the, (gasp!), cheaper counter tops & other finishes? Some of them – unless you’re really nit picky look exactly like the expensive stuff.

In any case, YOU live there – why buy the same stuff every other new house or renovated home happens to have? Style is fickle & it’s a sure bet when you sell your current, recently updated pad, the new buyers are going to rip everything out for the latest trend.

#109 Holy Crap Wheres The Tylenol on 04.23.14 at 8:54 am

#106 Herb on 04.23.14 at 8:14 am
#43 Trojan Horse,
MPAC’s “current value assessment” is based on the sales history of the property and neighbourhood comparables, as well as the value developed for factors such as size, rooms, location, condition, etc. “Market value” is based on what an owner thinks his place is worth, and what a real estate salesperson thinks it can get (even if only to get the listing).

Which do you suppose is more objective?

_____________________________________________
Neighbour just sold here in Oakville. RE agent comes in to bitch him and his agent out about the asking price $1.6M and says only assesed at $900K. The agent says and I quote”When have you ever seen the assesed price and the sell price be the same value, they are two separate entities.”
Case in point he sold $1.65M, assessed still at $900K. Considering the representing facts of the assesmnet and not being influenced by personal feelings or opinions the assesment should be more objective, but does it matter when sell price trumps all.

#110 Herb on 04.23.14 at 9:01 am

#83 Ottawa Mike,

and as a renter I have to pay $15.85 every time I want to get useful info on a property of interest. As if renters did not pay the owner’s property taxes by way of about 20% of their rent.

(Always meant to tackle the Province on that bit of nonsense but haven’t gotten around to it.)

#111 shawn on 04.23.14 at 9:05 am

Winners Win, and Losers Lose

Freedom First at 99 says:

the losers are the ones who are roped into going into debt to finance their lifestyle, and then, by numerous types of “unseen events”, the losers are unable to continue to finance their mortgaged lifestyle. The winners/manipulators, etc., of course are the ones who walk away with all of the assets purchased using debt, plus everything else from the losers.

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

Indeed, and Winners win and losers lose. (Fairly consistently, that is)

And most who are destined to lose the game don’t know what they are doing wrong.

#112 Herb on 04.23.14 at 9:16 am

#109 Holy Crap …

well, last place I owned I replaced a disintegrating single car garage with a shiny new double one. A couple of months later an MPAC agent dropped around to inspect the garage and to see whether I had made any other improvements to the property.

Asked him how he knew about the new garage: MPAC had accessed the building permit issued by the City of Ottawa. CAV may be a “trailing indicator”, but MPAC in Ottawa catches up real quick.

#113 Ray Skunk on 04.23.14 at 9:35 am

I have a few grad-school-pals who are RE agents. Late 20’s or early 30’s. They all have the same shtick – a leased BMW, Audi or Merc. Apparently a whopping luxury SUV is *the* vehicle to own when stop-starting around tight downtown underground condo parking lots all day.

Never seen the attraction myself. I know you want to exude an image of success (think American Beauty), but I would always be embarrassed about rubbing in my clients faces how much I’m making out of them.

My r*altor is extremely successful, got all that “presidents club, top 1%” crap all over his card. And I believe it, if only from the number of referrals and activity among my group of close friends. What does he drive? A 2005 Toyota Echo. That says a lot to me about fiscal common sense and who I should buddy up with in this transaction.

#114 Alberta Ed on 04.23.14 at 9:41 am

Calling the Big Owe… Calling the Big Owe….Hello?… Hello? (click…)

#115 eddy on 04.23.14 at 9:58 am

106 Herb on 04.23.14 at 8:14 am
#43 Trojan Horse,
MPAC’s “current value assessment”


I’ve posted it before but it needs repeating:

Never, under any circumstances, let anyone from MPAC into your home- You didn’t appoint them, you didn’t vote for them, Absolutely no one asked for MPAC: MPAC is government outsourcing at it’s worst. if you don’t believe me go to their web site where they explicitly state that they consider interior finishes and features as adding taxable value, oh yes, oh yes.
If you don’t let them in they will assume that the interior is = to the exterior. So keep the outside ugly- vinyl siding etc.

MPAC proves that your government is too useless to figure out the value of what it is they want to tax, all they know is they want to tax it, so they take your tax dollars and pay it to someone to tell them what it’s worth.

#116 Daisy Mae on 04.23.14 at 10:02 am

#15 Doug: “How about the Government gets out of the mortgage insurance business? Wind CMHC down, offer no new insurance policies immediately and wind down all coverage in 10 years. Make the banks take the risk that they ought to be taking.”

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

‘Cause that makes too much sense. And we simply can’t have that, don’tcha know? ;-)

#117 Marco Polo on 04.23.14 at 10:04 am

I like the comments of feeling entitled over past pricing. like somehow it’s different or special. if I buy used tires, its easy to see past pricing to see what they’re worth. A used car, easy. A used resale house.. whoa there!

#118 Ray Skunk on 04.23.14 at 10:09 am

#100

From your photo Garth, the other thing that I don’t understand is why German family cars such a Mercedes and Audi seem to be considered luxury brands by such people. Here in England they are priced at not much more than top end Fords and the same as Toyota.

I had $30,000 cash to spend on a gently used 4×4 car last weekend for our trips to France and Italy and had the choice of a Mercedes B Class, a VW Tiguan, a Mazda C5 or an Audi Q3. All the same price. I took the VW as a nicer ride. These German ordinary family cars must be making a fortune in Canada by positioning themselves as luxury. Luxury is a Bentley or Jag.

————————————

Yep, over in Europe BMW’s and Audis are quite, quite common. Many police forces use BMW in the UK at least. Also, in the UK there is a big company car culture – where status is king. The tax cost to the employee is based around emissions, servicing is covered, so everyone likes to plump for the Beemer over the Honda.

Why are they so expensive here? Back in the 80’s anything coming out of Detroit would have a realistic life of around 3-4 years. You can still see people daily driving 80’s German metal today. They were built to last, used premium materials and (importantly for me anyway), weren’t ugly. Ford or GM? Oy. You’d be hard pressed to even see anything 90’s from those guys around these days. Ask yourself when the last time you saw a Pontiac Sunfire – a car that was absolutely everywhere in ’98 – driving on the road?

Marketers have been able to double down on this reputation over thirty years and therefore European cars are still considered something “special” and premium, despite American brands’ build quality being up there – and in some cases better – these days.

#119 Daisy Mae on 04.23.14 at 10:24 am

#25 Observer: “I would be inclined to ask anyone who drops by here claiming it’s not the government’s job to prevent “stupid”, to just take a drive on the highway and observe those white rectangular signs with the black letters saying “speed limit”…..”

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

Good point. We can’t be trusted, often don’t think for ourselves, so we must be told what to do. So pathetic.

#120 Free on 04.23.14 at 10:29 am

Democracy is a system in which a populace believes they are free. Free to be a consumer and buy stuff wherever they choose. Free to be manipulated by government monetary policy. Free to pay $900,000 for a TO outhouse and accept servitude to their local friendly bank for the rest of their free life.

#121 Eamon on 04.23.14 at 10:37 am

Hi Garth, wondering what kind of investments you are bullish on at the moment? Short term/Long Term?

Everything you blog about is about real estate and the doom and gloom. Where are you putting your $?

Thanks.

Rule of 90. I adhere to it. So the bulk of my net worth is in a balanced and diversified, non-cowboy financial portfolio. Average return over the last four years is 10.2% and over the last decade is 7.3%. — Garth

#122 Slim Pickens on 04.23.14 at 10:39 am

Danish mortgages – Something rotten
Denmark’s property market is built on rickety foundations

http://www.economist.com/news/finance-and-economics/21600994-denmarks-property-market-built-rickety-foundations-something-rotten/print

#123 Holy Crap Wheres The Tylenol on 04.23.14 at 10:39 am

#113 Ray Skunk on 04.23.14 at 9:35 am
I have a few grad-school-pals who are RE agents. Late 20′s or early 30′s. They all have the same shtick – a leased BMW, Audi or Merc. Apparently a whopping luxury SUV is *the* vehicle to own when stop-starting around tight downtown underground condo parking lots all day.
Never seen the attraction myself. I know you want to exude an image of success (think American Beauty), but I would always be embarrassed about rubbing in my clients faces how much I’m making out of them.
My r*altor is extremely successful, got all that “presidents club, top 1%” crap all over his card. And I believe it, if only from the number of referrals and activity among my group of close friends. What does he drive? A 2005 Toyota Echo. That says a lot to me about fiscal common sense and who I should buddy up with in this transaction.

_____________________________________________

Your realtor has brains, that’s what I mean at least its transportation and not opulent representation. Me I own a company with 80 employees, could retire now in my 60’s, have a sailboat, nice home (bought 30 years ago when I was poor) and my daily driver a Ford Edge. Some of my employees have the BMWs and high end Japanese cars that are worth more than my domestic. Cars are just a bad investment and you are correct in saying don’t rub it in someones face! I always like to stay under the radar.

#124 Gypsykid on 04.23.14 at 10:43 am

Garth, can you do a post about this crazy stock market? I was too lazy to get in and now I’m too afraid of the market. What should one do in a Bull Market like this? Should I wait for a correction? Sometimes I think both the real estate and the stock market is too high.

With financial assets you can easily do what’s impossible with real estate – create a balanced and diversified portfolio. — Garth

#125 Daisy Mae on 04.23.14 at 10:44 am

#53 TheCatFoodLady: “If we can do that & still convey that life is a hell of a lot of fun, even on a budget, one person at a time… we can help.”

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

As usual, you make alot of good points! ;-)

#126 Herb on 04.23.14 at 10:55 am

#115 Eddy,

sorry, Eddy, access is not discretionary. Assessment Act , RSO 1990:

Right of access

10. (1) A person authorized by the assessment corporation, upon producing proper identification, shall at all reasonable times and upon reasonable request be given free access to all land and to all parts of every building, structure, machinery and fixture erected or placed upon, in, over, under or affixed to the land, for the purpose of making a proper assessment thereof. R.S.O. 1990, c. A.31, s. 10 (1); 1997, c. 5, s. 6 (1); 2006, c. 33, Sched. A, s. 10.

http://www.e-laws.gov.on.ca/html/statutes/english/elaws_statutes_90a31_e.htm#BK10

#127 Holy Crap Wheres The Tylenol on 04.23.14 at 10:56 am

#105 Herb on 04.23.14 at 8:00 am

“You can’t bend what you can’t offend…” (SM @ #17)

and that’s your trouble, tootsie.

_________________________________________________
Not quite sure about the offending part or sure about the bending part?
Who is doing the bending?
Who is doing the offending?
Is this one of Smoking Mans mantras?
Is he the bender?
Is he the offender?

Hell I think I have the lyrics to a rap song! Going to tuck that one away for later! Sorry Smoking Man this one is mine! ® ™ ©

#128 SCIBADUBADEBUMBADO on 04.23.14 at 11:03 am

#38 bobbo on 04.22.14 at 8:48 pm

I happen to love Smoking Mans Posts. Great entertainment and tidbits of truth scattered in between!

Just scroll your mouse over to the next post if you don’t like it.

#129 Daisy Mae on 04.23.14 at 11:11 am

#98 JP: “But how is the already broke tax payers going to pay for it all?”

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

‘Can’t get blood from a stone’ so we will see massive service cuts, for starters…..

#130 rosie "moving forward" in the knowledge that, "this won't end well" on 04.23.14 at 11:15 am

See, people are smart.

http://business.financialpost.com/2014/04/20/cash-back-mortages-a-deal-from-your-bank-that-regulators-are-not-keen-on/

#131 jess on 04.23.14 at 11:19 am

bid rigging
http://www.justice.gov/atr/cases/f263400/263440.pdf
http://www.stopfraud.gov/news/news-09092010-3.html
The case is U.S. v. Campbell, U.S. District Court, Southern District of New York, No. 10-cr-00803.

This page lists named defendants (and products or industries involved) in pending cases prosecuted by the Antitrust Division for which public court proceedings are scheduled.
http://www.justice.gov/atr/victim/vrhearings.html#campbell
http://www.nabl.org/uploads/cms/documents/history_of_gic_bid-rigging_enforcement_actions.pdf
=
e.g.
Georgia Real Estate Investor Pleads Guilty to Bid Rigging and Fraud at Public Foreclosure Auctions
Fourth Case Filed in Georgia Real Estate Foreclosure Auctions Investigation
conspired with others not to bid against one another, and instead to designate a winning bidder to obtain selected properties at public real estate foreclosure auctions

============
Canada’s Finance Minister Oliver :
“As an investment banker and a securities regulator I’ve seen the inefficiency that flows from our current system of each of our 13 provinces and territories having its own securities commission. It leads to not only inefficiency but it leads to an impact on enforcement and on the oversight of systemic risk,” he said.

#132 jess on 04.23.14 at 11:21 am

reshoring or offshoring /forward-compatible?
http://www.tribunemagazine.org/2014/04/cabinet-office-seeks-to-offshore-whitehall-jobs/
Written By: David Hencke
Published: April 19, 2014 Last modified: April 16, 2014
…”Whitehall jobs handling sensitive personal pay roll details and possibly even criminal and police records are to be moved offshore by private companies under a Cabinet Office initiative to save money, Tribune has learned…

http://www.steria.com/
Steria, a leading provider of IT-enabled business services, today announced the signature of a framework contract with the Secretariat General of the Council of the European Union to modernise its PKI (Public Key Infrastructure), thus streamlining all the resources used to share information internally and between EU Member States. Worth an estimated €6 million, the contract is for a period of four years and renewable twice for an additional period of one year.

Under the terms of the contract, Steria is to standardise the existing PKI and make it more forward-compatible, as well as increasing its robustness and reliability. These developments will boost interoperability between the Council’s systems and those of Member States. This major transformation in security infrastructure will also include the simplification and automation of all related procedures. …
http://www.steria.com/uk/media-centre/press-releases/press-releases/article/the-council-of-the-european-unions-general-secretariat-chooses-steria-to-secure-its-internal-comm/

#133 Retired WI Boomer on 04.23.14 at 11:30 am

NY Times shows Canada’s middle class now has more disposable income than the US. Good for the Canuck’s they deserve it. Now, if they can keep from pissing it away on over-priced real estate via the bank’s sure to rise mortgages maybe can keep that distinction for a few generations.

Naw, I give them less than 5 years, until their 1st mortgage rate reset, then it’s belly-up for many.

Debt – The NEW lifestyle!!

#134 Enthalpy on 04.23.14 at 11:36 am

$1.27 for regular? Doesnt look very winter like. Must be from last season ;)

#135 Enthalpy on 04.23.14 at 11:47 am

you can sign up for emails of sold houses.

for example

http://torealestatesold.com/homes-sold-on-toronto-mls-210414/

Though I guess its accuracy could be questioned. No mention if the property has been relisted either.

Buyers want to know the price history of houses that are for sale, not those which just sold. — Garth

#136 Alexander on 04.23.14 at 11:50 am

The minister of immigration is introducing a new program starting Jan 1st.

It is called “Express Entry”.

Game changer! Expect SFD prices in Vancouver and Toronto to go even higher.

Then the governments hands will be tied and they can never raise rates.

Google it.

#137 Old Man on 04.23.14 at 12:03 pm

#132 jess – The Olive Man is as old as dirt and needs to be excused for his rants on behalf of Caesar. Here is the intent that the reformists are trying to pull off on Canadians about securities regulation, as don’t buy their premise in the least. They want a transfer of power from the Provinces to the State under Caesar; destroy provincial oversight in favour of Ottawa. Its all a matter of control from the top to strip the Provinces of individual sovereighty.

#138 Pre Retiree on 04.23.14 at 12:03 pm

#4 Gladiator

I completely agree with this statement.
Plus, with the non-intellectuals, non-economists voting for Trudeau for emotional and historical reasons (beats me why), the Liberals are likely to inherit the mess, and thus, will not stay in power for too long.
Too bad it is the people who will have to pay the price.

#139 Joe on 04.23.14 at 12:08 pm

Garth you need to spearhead an awareness movement that endorses the disclosure of information as on Zillow.

You have a large following, why not forward a petition that we can sign and share?
If I’m not mistaken you are dismayed by the tactics being used?

You have the platform the audience and the right intentions.

An old teacher of mine told me that to prevent people from thinking all you have to do is eliminate information, he pointed out how many words had disappeared from the dictionary.

Someone with clout has to counter the cartels .
Someone has to rattle their cage.

#140 Doug in London on 04.23.14 at 12:16 pm

So the feds don’t want a housing dump. In the short term a housing dump would cause a lot of pain, bot in the long run it would be the BEST thing to happen to Canada since Confederation in 1867. Why? In the same way a fire clears out dead wood and opens up the boreal forest for new growth, a good correction in the housing market would bring housing back to within sight of affordability (at least with a good telescope). Ultimately, that would reduce our cost of doing business and stop more industries from fleeing our great country. Has anyone noticed that the economic recovery in the United States occurred after housing returned to reality? Expect the same for Canada when housing returns to reality.

#141 Pre Retiree on 04.23.14 at 12:23 pm

Garth,
To which blog can you refer me to for the Rule of 90?
I was not following this blog yet when you described it, as I assumed you have at some point.
Thanks.

#142 Buy? Curious? on 04.23.14 at 12:24 pm

When in 2016 will interest rates rise? Which quarter? Is December 2015 the best time to buy a condo? I found an entrepreneur with similar theories as to when the exact moment is to jump in the market, feet first. Go hard or go home.

https://www.youtube.com/watch?v=RP4abiHdQpc

One more question, I bought my house almost exactly 2 years ago, will it go higher or lower than May 2012?

Rob Ford 2014! He’s literally the BIGGEST Raptor fan.

#143 BCD on 04.23.14 at 1:03 pm

Why are they so expensive here? Back in the 80′s anything coming out of Detroit would have a realistic life of around 3-4 years. You can still see people daily driving 80′s German metal today. They were built to last, used premium materials and (importantly for me anyway), weren’t ugly. Ford or GM? Oy. You’d be hard pressed to even see anything 90′s from those guys around these days. Ask yourself when the last time you saw a Pontiac Sunfire – a car that was absolutely everywhere in ’98 – driving on the road?

Marketers have been able to double down on this reputation over thirty years and therefore European cars are still considered something “special” and premium, despite American brands’ build quality being up there – and in some cases better – these days.
____________________________________

Ray Skunk. . .you’ve obviously never driven a German car. I’ve owned a couple and they were ALL overrated, broke down frequently and were expensive to repair. Japanese cars are still the best for my money, but some old GMC and Ford trucks lasted forever (I know because I recently stopped driving an ’87).

In general cars last longer when you take care of them, but all things being equal this whole “german engineering” is a myth. Give me Japanese anyday over “German Engineering” BS.

#144 Ray Skunk on 04.23.14 at 2:11 pm

#143
Ray Skunk. . .you’ve obviously never driven a German car.
——–

In the past 5 years to today I’ve owned three VWs and a Porsche. 86/87/07/12. Driven dozens of them.

I didn’t bring Japanese into the equation because that wasn’t the discussion. German quality vs. Japanese quality is not what I was responding to. The discussion was why European (not Japanese) brands are at a premium in North America and cheap in Europe – and I contended this is because of the reputation of the German cars of the 80’s.

I’m more than familiar with the modern quality control issues in German cars (VW coil packs anyone?). That said, I’ve never suffered a breakdown myself, touch wood. An ex of mine had an Audi which – while reliable – was a maintenance moneypit that nickled-and-dimed her until she called it quits and bought Japanese (built in the US, naturally).

As I said, in recent years German cars have gotten too complex for their own good and quality is suffering. The gap between German/Japanese in the 80’s and the chasing pack was huge. Now everyone has caught up. Even the modern Japanese car is not bulletproof; the 2012 Civic was slated to the point where Honda had to bring in a mid-model refresh – unheard of for them.

The Germans (and to a certain extent) the Japanese are still riding the wave of reputation that they built up decades ago, regardless of where they’re actually at today in comparison to the competition.

On the flip side, the Koreans (including Garth’s favourite manufacturer) are still considered budget and need to price themselves below the competition – despite winning numerous awards, being able to offer longer warranties and having better satisfaction ratings than their rivals.

Past reputation sometimes outshines recent facts.

#145 Pope Six Pack Snugglebombed the 999rd (aka Nosty) on 04.23.14 at 2:16 pm

#72 Spectacle on 04.22.14 at 10:35 pm — “I think some of the dormers would be more effective if they made their points on here relative to the UN Agenda-21 and it’s horrible, devastating effects.”

Speaking of Agenda 21, land- (Texas) and water grabs, building condos the world over so sheeple will be squashed into them and forced to live subservient lives, add on Microchip Implants For All Americans in 2017. No doubt that will include us as well, as it is necessary to keep those Odg-awful terrorists out!

BTW, the Dutch and English air forces scrambled their jets today to intercept Russian bombers, except the Russkies were flying in international air space which all air forces are allowed to do. Methinx Putin is checking on the defenses.

Also, More Store Closings. Is the economy doing a U-turn?

#146 Old Man on 04.23.14 at 2:27 pm

Caesar Alert: There might have been a scandal at 24 Sussex last weekend. Keep your eyes open for updates, as this don’t look good; we need to know the truth.

#147 "Disaster Capitalism" on 04.23.14 at 2:30 pm

That’s right! Our Conservative Fascists will continue their agenda from the GOP republicans and destroy anything half descent we had in this country.

don’t worry Garth, I’m so outta here!

#148 sciencemonkey on 04.23.14 at 2:50 pm

My thought for the day relates to comments here saying that Canadian businesses will be uncompetitive due to high RE prices. I disagree.

Let’s take a big city like the GTA as an example. Sure, houses are super-expensive, but young people still choose to work here if they are lucky enough to actually get a job. Are we grilling our bosses for giant pay raises to afford half a million dollar bungalows, in an environment of labour oversupply? No. We take what we can get, although in some cases we get decent raises if we are valuable tax farm slaves.

Yes, it’s true that something has to give. What gives isn’t Canadian competitiveness, but rather young people’s aspirations. Those unwilling to take on massive debt realize that they will not be middle-class, they will not live in houses, they will not have a cottage, they will not have children, they may have a child-substitute dog, although more likely it will be a cat.

This discussion, of course, is separate from other factors that may decrease Canadian competitiveness, such as taxes, energy costs, etc.

#149 Son of Ponzi on 04.23.14 at 3:34 pm

The BRE-x case is finally closed.
Which stock is the next to bring the market down?

Bre-X did not crash the market. Just idiot investors who turned into gamblers. — Garth

#150 Son of Ponzi on 04.23.14 at 3:39 pm

average Canadian house price 66% higher than in the US.
So, Vancouver’s is probably 200% higher.

#151 Holy Crap Wheres The Tylenol on 04.23.14 at 4:02 pm

#143 BCD on 04.23.14 at 1:03 pm
#144 Ray Skunk on 04.23.14 at 2:11 pm
#143 Ray Skunk. . .you’ve obviously never driven a German car.

______________________________________________

Off topic but Japanese, German, Italian, North American there are good ones and bad ones in every bowl of apples. The truth of the matter is as some in an earlier posting said, “Just take good care of your vehicle and it will last quite a long time.” Too many people drive the living $hit out their cars with no regard to routine maintenance and common sense. Then they wonder why it only lasted 3 years. My brother has a 1995 mustang as his daily driver, still spotless well maintained. Oh yes and he owns it outright, well since at least 1995 or so. It owes him nothing and he happens to like driving it. So just take care of whatever you drive and you should get many years out of it just like any other well maintained machine.

#152 :):(Ying Yang on 04.23.14 at 4:10 pm

#17 Smoking Man on 04.22.14 at 7:44 pm
Isn’t human nature so predictable, yesterday chirping my butt up the Ying Yang.
………………………………………………………
Smoking Man why are you getting me involved? This little old Ying Yang dint Chirp Yall!
Sorry man just couldn’t resist♋️

#153 Nemesis on 04.23.14 at 4:16 pm

#SeasonalAmusements #HastaLaVistaEspana #UdderlyOutrageous #HaveYouDrivenAFord,Lately?

[CommonDreams] – From Farm Workers to Cheerleaders

…”Members of the Oakland Raiders’ squad calculate that their pay works out to less than $5 an hour, while the Cincinnati Bengals’ cheerleaders (who bear the burden of being called “Ben-Gals”) are paid about $2.85 an hour — far less than the federal minimum wage — to be worked like mules, constantly abused, cheated and disrespected.

Astonishingly, though, a recent ruling by the U.S. Labor Department says that this does not violate federal law. Why? Because the macho sports industry got its cheerleaders categorized as “seasonal amusement” — a loophole that exempts them from our national pay rules.”…

http://www.commondreams.org/view/2014/04/23-7

[UK Telegraph] – Why the sun set on my Spanish dream

…”As figures reveal that 90,000 Britons returned home from Spain last year, due to a shrinking job market and continuing property slump, one expat explains why she had to wave farewell to her Mediterranean life.”…

http://www.telegraph.co.uk/news/worldnews/europe/spain/10782380/Why-the-sun-set-on-my-Spanish-dream.html

[TomTomorrow/Nation] – RancherBundy

http://www.thenation.com/blog/179478/rancher-bundy-and-his-cows-visit-big-apple

#FordGT-StandingMileWorldRecord

http://youtu.be/7tZPj7Ebh0o

#154 Ralph Cramdown on 04.23.14 at 4:29 pm

#78 BCD — “Renters keep hoping for a crash that will never come. . .reality is larger then your Vancouver, or Toronto. Real estate is a global game and there is more money than you can imagine, with cheap credit and no end in sight.”

Reality is the same as it ever was in the real estate game. If you buy something with a net income of 7-10%, you brag to all your friends. 4-7%, you wait and don’t brag as much. Less than 4%, and you sit around with all your friends making up stories about why property prices are going to go up.

Residential real estate, except in London and Manhattan, is about as un-global as you can get. Most buyers don’t consider which city looks like the best investment and then which property within that city is the best bet. They buy where they live and according to personal tastes, some of which are universal (good school district) and others decidedly less so (near where they work, reminds them of childhood home). When money is easy they borrow their brains out, at other times not so much. These are the people you’re competing with when buying that type of property, and who’ll make the market when you’re selling it again. What could go wrong?

In previous real estate manias, as in other types of mania, there was never an end in sight. You think people bought knowing that a crash was likely imminent, but that they could get out first? Nope, they made up stories just like the ones we hear today; “unless interest rates rise or unemployment spikes…”

#155 Doug in London on 04.23.14 at 4:38 pm

@sciencemonkey, post #148:
When the cost of living in any area is high, whetner due to housing costs or any other costs it DOES affect the cost of doing business. Yes, young people will accept any job they get, but once they get experience they will shop around and look for a job with better pay elsewhere if the one they have barely pays the bills. The employer that doesn’t pay more in wages will ultimately pay more in training costs due to high staff turnover.
I worked for a company that has offices all around Ontario (and a lot of employees in the GTA) which at one time paid more to employees in expensive locales like the GTA. The union didn’t like that idea, and changed it so all employees get the same pay regardless of location. The effect was highly predictable such that the GTA has a distorting effect on the rest of the province, and in cheaper to live locations wages are higher than would be determined by local supply and demand. Do you still think the expensive housing in the GTA doesn’t drive up the cost of doing business in the GTA, or for that matter all of Ontario?

#156 general observer on 04.23.14 at 4:43 pm

#92 Chris on 04.23.14 at 12:46 am
In the US, appraisal, property tax, sales and other property details information are readily available to everyone on the county appraiser’s website. All you need to do is type in the property address and there it is. Why is Canada so backward in this regard. Information is the ultimate weapon and should be available to everyone.

Me – thats because we canadians are to lazy and to retarded to do much of anything except to talk how much our net worth has increased due to RE which always,always goes up !!!!!

#157 Old Man on 04.23.14 at 4:46 pm

Canada to send up to 500 observers to monitor the Ukraine election in May? I hope his entire political party is sent and Caesar can lead his circus of clowns. I thought this was the responsibility of the UN; not that of Canada. Is Caesar willing to sacrifice lives if trouble breaks out? Will Caesar be going to issue orders? I say we need someone to monitor our elections from corruption in 2015 or sooner. I wouldn’t trust Caesar to walk my dog on a sunny day or monitor any election on the face of the earth, as with his group 1 + 1 might equal 11 on the count.

#158 general observer on 04.23.14 at 4:53 pm

#100 Jane24 on 04.23.14 at 4:06 am
Yes that is the bit that I don’t get, the way that many younger Canadians associate debt with wealth. They will say I live in a million dollar house but don’t seem to understand that they only own 1/10 of it. Then they match it with a million dollar lifestyle – all on credit.

From your photo Garth, the other thing that I don’t understand is why German family cars such a Mercedes and Audi seem to be considered luxury brands by such people. Here in England they are priced at not much more than top end Fords and the same as Toyota.

I had $30,000 cash to spend on a gently used 4×4 car last weekend for our trips to France and Italy and had the choice of a Mercedes B Class, a VW Tiguan, a Mazda C5 or an Audi Q3. All the same price. I took the VW as a nicer ride. These German ordinary family cars must be making a fortune in Canada by positioning themselves as luxury. Luxury is a Bentley or Jag.

Hm…No racist rant today on how the eastern european beggars are destroying London, the real london..LOL ?
FYI – the only reason bentley is the nice ride it is because they use BMW v12 engines and the rotten lemon jag uses ford power trains.
Now, go back to your cave already Jane 24.

#159 Ralph Cramdown on 04.23.14 at 4:55 pm

#144 Ray Skunk — “The discussion was why European (not Japanese) brands are at a premium in North America and cheap in Europe – and I contended this is because of the reputation of the German cars of the 80′s.”

That’s much of it. Three other important factors, I think.

1) The level of the Deutschemark relative to the dollar, and later, to the Yen. German cars weren’t just good, they were very, very good for the price, in the US.

2) Lexus. Before Lexus, top German cars didn’t really have any competition. As a result, they weren’t really built “to a price,” they were just built to be supremely good automobiles. Toyota’s introduction of the Lexus LS changed that forever.

3) Deliberate market segmentation by the Europeans. You just can’t buy a stripper E class Benz with cloth seats and manual, three dial heating controls in North America, but they’re ubiquitous on mobile.de. They didn’t import their smaller models or their smaller engines either, with a few notable exceptions.

#160 Paul on 04.23.14 at 4:55 pm

The musical chair doesn’t stop in Toronto. It merely pauses.

#161 DM in C on 04.23.14 at 4:55 pm

“Ask yourself when the last time you saw a Pontiac Sunfire ”

Every day — hubby drives my 2001 daily ~ 120km. She’s up to 250,000 km now, and has taken us cross the country.

We just replaced our 2002 caravan with 184,000 km (transmission was going) for a Hyundai Tuscon. Not a bad little crossover.

#162 fixie guy on 04.23.14 at 4:56 pm

@#148 sciencemonkey: Your theory is that reduced aspirations and lowered expectations are conducive to maintaining global competitiveness? Interesting.

#163 Ed on 04.23.14 at 4:56 pm

When reality hits…

http://www.theatlantic.com/business/archive/2014/04/how-did-canadas-middle-class-get-so-rich/361053/

#164 general observer on 04.23.14 at 5:04 pm

Foreign buyers are not responsible for $900,000 semis in Toronto or million-dollar Vancouver specials. We did that. — Garth

Me – actually sir Garth, most hipsters who buy these 900k plus nightmare Toronto/Vancouver digs firmly believe the price will accent without end because of foreign money flowing in from abroad unchecked so, please get your facts straight.

My point. — Garth

#165 Bargains everywhere on 04.23.14 at 5:13 pm

#158 general observer on 04.23.14 at 4:53 pm

I find your remarks offensive. There is no need for your rude comments to Jane 24. Please stop it.

#166 Peter on 04.23.14 at 5:24 pm

My point. — Garth

And check NY, London.

Why? Those cities actually matter. — Garth

#167 sciencemonkey on 04.23.14 at 5:55 pm

@162 fixie
That consideration hit me on the way home, very good point.

@155 Doug
I suppose it depends on the industry; how available jobs are in general, and in big vs small cities.

I know my employer gives no special consideration for being in the GTA.

#168 Trojan House on 04.23.14 at 6:02 pm

#106 Herb on 04.23.14 at 8:14 am

Right. So which one do you think a seller will take?

#169 airhead princess on 04.23.14 at 6:03 pm

“kilby on 04.22.14 at 7:45 pm
Before anybody thinks that realtors are all making money by looking at their cars, remember yesterdays M3 E 46 convertible is probably a 2004 and worth about $19,000 in good shape, today’s Audi is likely a base lease model, around $450 a month to look successful….:

Too right… talk to any car lot vulture and they’ll tell you that not a single person ‘buys’ a car any more…..they all rent ….er’ ‘lease’. This has allowed the car manufacturers and dealers to increase the price of cars through the roof. Because no one cares what they cost any more….have you ever seen a price on a commercial in the last ten years since the ZIRP was announced? That BMW has gone from $15,000 to $60,000 becuae of the low monthly payments.

I had personal experiance with this a couple of years back on an Acura lot…..I walked in and bought a new one….wrote a cheque for the full amount and slapped it on the table. The salesman didn’t know how to process it……the all new Canadian staff in the back room had no idea either. I let them off the hook by negotiating a trunk full of swag and gave the manager time to drive to the bank and get schooled by my local manager what a cash sale was.

#170 Peter on 04.23.14 at 6:03 pm

Why? Those cities actually matter. — Garth

And Toronto doesn’t ?

#171 jess on 04.23.14 at 6:17 pm

#157 Old Man

Ontario Securities Commission’s release of Staff Notice 15-702 on March 14, 2014. This Bulletin introduced the limited permissibility of Non Prosecution Agreements (“NPAs”) or “no enforcement action agreements

http://www.osc.gov.on.ca/documents/en/Securities-Category1/sn_20140311_15-702_revised-credit-coop-program.pdf

#172 Nemesis on 04.23.14 at 6:28 pm

@OldMan/#157

Seriously? How else are those poor Ukes supposed to get their RoboCalls Up&Running in time?

Sheesh!

http://youtu.be/kPW93r22bSc

#173 general observer on 04.23.14 at 6:35 pm

#169 airhead princess on 04.23.14 at 6:03 pm
“kilby on 04.22.14 at 7:45 pm
Before anybody thinks that realtors are all making money by looking at their cars, remember yesterdays M3 E 46 convertible is probably a 2004 and worth about $19,000 in good shape, today’s Audi is likely a base lease model, around $450 a month to look successful….:

Too right… talk to any car lot vulture and they’ll tell you that not a single person ‘buys’ a car any more…..they all rent ….er’ ‘lease’. This has allowed the car manufacturers and dealers to increase the price of cars through the roof. Because no one cares what they cost any more….have you ever seen a price on a commercial in the last ten years since the ZIRP was announced? That BMW has gone from $15,000 to $60,000 becuae of the low monthly payments.

I had personal experiance with this a couple of years back on an Acura lot…..I walked in and bought a new one….wrote a cheque for the full amount and slapped it on the table. The salesman didn’t know how to process it……the all new Canadian staff in the back room had no idea either. I let them off the hook by negotiating a trunk full of swag and gave the manager time to drive to the bank and get schooled by my local manager what a cash sale was.

#170 Peter on 04.23.14 at 6:03 pm
Why? Those cities actually matter. — Garth

And Toronto doesn’t ?

Me – I suppose you’re equating car prices with real estate prices in Canaduh.
Good point my sweet princess….Love ya.

#174 Holy Crap Wheres The Tylenol on 04.23.14 at 6:42 pm

#170 Peter on 04.23.14 at 6:03 pm
Why? Those cities actually matter. — Garth

And Toronto doesn’t ?

Those are world class cities with power and clout! People flock to them for this reason!
People come to Toronto because they are attracted to it like moths to a porch light !

#175 Daisy Mae on 04.23.14 at 9:12 pm

#140 Doug in London: “…a good correction in the housing market would bring housing back to within sight of affordability…”

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

Yes. The pendulum is swinging, as it always does.

#176 reader on 04.24.14 at 2:10 pm

Garth, what do you think about the REP (régime épargne-propriété) that the new Quebec government is preparing?

Any article coming soon about Montreal or Quebec real estate?

I hate this pathetic blog… ;)

#177 Marco Polo on 04.24.14 at 5:06 pm

Could a Russian invasion of Ukraine crash the UK housing market? Without exploring the myth of HAM, the UK and Europe do have some well-heeled Russian owners of top properties. Very little of this wealth was obtained honestly. The London RE market is at new highs.

It takes a pin to pop that balloon. US or UK sanctions could do it. Stephen Poloz seems to think our magical bubble exists a vacuum, low rates are here forever, nothing will ever happen in Russia, China or Japan outside of his control. What a joke.