Expectations

PISSED modified modified

They say oil prices could tumble again after big talks went sideways yesterday in Doha. That would suck. (Update: they did. Down 6%.) We just nicely roosted over forty a barrel, giving some hope the bottom was in. Maybe not.

Two of our oiliest provinces had budgets last week. In Alberta, Premier Notley threw up her hands and said the spending wouldn’t stop, so there’ll be big deficits for the next ten years. At least. In Newfoundland, they don’t give up so easy. The province slashed spending and raised taxes, trying desperately to live within its means now that the oil money’s stopped flowing.

“I used to work in NL on one of the province’s major construction projects,” says Dom, “and my friends on the island have been sharing their despair over the new provincial budget.  HST, fuel tax, insurance rates, and income tax all going up, and subsidies such as a “baby bonus” and the tuition freeze at Memorial University, which has been in effect since the early 2000s, may be coming to an end.”

As you may know (and probably don’t), the real estate market in Saint John’s was on fire until somewhat recently. Prices that languished in the absurd (think sixty grand for a nice house) for decades, suddenly shot to Mississauga levels. Just like in the GTA or YVR, families borrowed big because money was cheap and the market was rollicking ahead.

Besides, why not? It’s different this time. How could the government change anything because with so many people owning such big mortgages, it would just crush. Anyway, houses are safe. They go up, Unlike stocks or something. (Where have you heard all this before?)

“Can’t help but think this is all self-inflicted,” says Dom. “And interest rates haven’t even gone up yet.  Not living within your means doesn’t just affect the 604 as the Rock shows.

“Your ‘mainlander’ readers may be shocked to know that there are very visible minorities in NL, so the blame shifts from ‘immigrants’ to the government for openly attacking families and not thinking about the children by raising taxes due to a significant budget shortfall.”

Meanwhile in poor Alberta, it’s shaping up to be a tough 2016 any anyone thinking about bailing out of their depreciating real estate. In Edmonton, a city of about 800,000 cowboys, dippers and civil servants, there are now 1,328 newly-built, unsold and unoccupied houses sitting vacant. This incredible glut comes at a time when construction is plunging – starts in the first three months of the year fell by 62% from the same period in 2015, according to Canada Mortgage and Housing.

Obviously this means house prices are going to decline, since cash-starved builders won’t sit on more than half a billion dollars in inventory. House prices in Edmonton have basically held steady from year-ago levels, but listings are starting to bloat and the surge in unsold new homes will certainly be taking its toll. Meanwhile in Calgary, sales are down 8%, listings are also rising and the average price is 1.8% higher than a year ago. That’s less than inflation – and way less after you pay commission to sell.

Now, for a true disaster, look north into the oil patch. Three years ago a mobile home on a few cement blocks would set you back up to $700,000 (if you could find one) because, of course, it was different this time. Everybody wanted to live where the big money could be earned. And, well, houses always go up.

Guess not.

The average days-on-market number in Mac has just passed the 200 mark. A year ago it was just 125 (in Toronto it’s 16). Sellers are also throwing in the towel. The market’s so dismal listings are actually on the decline. Single-family house sales crashed 63% last month, compared to a year ago, and the average prices has given up another 7%.

So you don’t live in Newfoundland, Alberta (or Nova Scotia, Saskatchewan, New Brunswick, Manitoba or most of Ontario) and don’t care? That’s fine. But don’t let the lessons others are learning pass you by. A bank survey last week found two-thirds of Canadians have essentially all of their retirement net worth in one asset – their house. It also found 60% of those people over the age of 45 have a mortgage.

That’s not exactly being prepared. No Plan B. Kinda like being in Saint John’s or Fort Mac and thinking because times are good and houses are hot, things’ll always be that way. Because it’s different this time. Everybody wants to live there. Nobody would dare change the rules – like raise rates or hikes taxes – since average, hand-working folks would be slaughtered.

Oh well.

Why do I bother? Until human nature changes, people will live in the moment. Better make it a good one.

143 comments ↓

#1 common sense on 04.17.16 at 6:25 pm

Thank you for your comment about the oil price situation.

Again what complete utter BULLSHIT, talking up the prices AGAIN on the rumour of a production freeze when all along it was 99% doubtful it would ever happen.

I just guess the US and world banks ONCE AGAIN need bullshit to raise the prices in order to cover the HUGE bad loans on oil they made ONCE AGAIN with our cash.

What BULLSHIT.

#2 Brazil ex-pat on 04.17.16 at 6:25 pm

Remember global cooling in the 70s?

Remember AIDS was going to kill everyone in the 80s?

Remember PEAK OIL in the 90s?

http://www.huffingtonpost.ca/2016/04/16/saudi-arabia-oil_n_9708840.html?utm_hp_ref=canada-business

Remember this link when you think about Global Warming will melt the earth in the 2000s

And there will be a terrorist under every rock so we need to bug and listen to everything you do and take away all your privacy in the 2010s.

#3 Saint John on 04.17.16 at 6:29 pm

Isn’t the spelling supposed to be “St. John’s”…

#4 Derry Hanover on 04.17.16 at 6:29 pm

Foist!

#5 Panhead on 04.17.16 at 6:36 pm

Never been there … but I love the Newfies. Who else would actually “cut back?”
And eat “flipper’s and gravy too.” One day I’m gonna come out and visit ya boyz … bet I have a great time too …

#6 TurnerNation on 04.17.16 at 6:37 pm

This weekend I ventured north in Toronto city – outside my downtown bubble. Absolutely shocking what a controlled, culture-less overpriced hell hole it is.

(But you might wail, we have clean air and water. Kinda. Keep in mind no sane person would dump toxins into their family’s well. But wealthy industrialists and corporations? Of course.)

– Food shopping is limited by the billionaire duopolists families: Westons (Loblaws/Shoppers Drug) or Sobeys. Paying 30-40% more than our US neighbors 150 clicks to the south.
– 905-area is a sprawl of like chain stores, mainly US publicaly traded companies (eg. Popeyes, KFC/Taco bell, Costso, Dave& Busters, and I can name 10 others).
– Customer service is non-existent. (They pretend to work, companies pretend to pay them?)

– Every tenth car in 905 area seems to be a Mercedes AMG model.
– Yorkdale mall offers Valet Parking for Holt Renfrew. All luxury imported makes in the lot but I saw on KIA mini SUV there.
– The mall has a new area looking like a Dubai mall or something with ultra luxury retailers. A uniformed police officer patrolled this area. Riff raff keep away. What tycoons and nouveau riche we must have here!
– Across from mall at confluence of busy streets and highways a sign for new Townhouses: $900,000

– I rode a filthy subway line built in the 60s, and one line still using rolling stock from the 1980s. I rode a downtown streetcar from the 80s, it was literally falling apart inside.
– Gridlock on most roads. Subway extension is of course behind schedule and massively overbudget due to inflated and corrupted contracts. Everyone looks the other way. It’s only tax dollars.

– Surprised at bareness and bleakness of the Lawrence West/East areas, all 1960s era schools, houses. Unchanged in six decades due to our 2nd World government.

– Much of this due to public unions, like transit and teacher unions ripping us for decades.
A Transit ticket collector can earn $100k with o/t. Even a fare inspector or TO police meter maid earns 6-figures with a bit of o/t. (An aquantaince of mine with friends/family on the force verified this.)

#7 common sense on 04.17.16 at 6:38 pm

What is this thing that is mentioned often on this blog about:

Raising rates?

#8 Kevin on 04.17.16 at 6:40 pm

Up, up and away.

http://www.huffingtonpost.ca/2016/04/16/canada-real-estate-projections_n_9648448.html?utm_hp_ref=canada

#9 Joe on 04.17.16 at 6:41 pm

You cite the economic basket case that was only briefly bouyed by oil prices for the last 10 years or so and a one horse town totally dependent on oil. Of course these markets are soft. Many other places prices are inflated and continue to rise: Vancouver, TO, Victoria, Kelowna, Parksville, Qualicum,

#10 Jimmy on 04.17.16 at 6:42 pm

Whew!
Late today.
Thought it was the end.

#11 John on 04.17.16 at 6:45 pm

Kuwait shut in 1.7 million barrls with today’s strike as workers. Are rejecting pay cuts. Schlumberger notified Venezuela last week that they will no longer work for free and will start shutting down production in a safely manner. Iraq hasn’t been paying the international oil companies. So now they decided to pay with Iraq bonds that can be traded cashed in at a Iraq bank for at s discount. Or hang on and hope they go up in value. Or drop further…..

Of course, nobody cares about this which is as trump would say. HUGE!!! They care more about countries that are agreeing to freeze production at rates that are even higher than they are producing, and at their highest ever in history, higher than what companies like Core Labs say that even SAudi can sustain. Making money in oil has never been easier. NEVER!!!

#12 crowdedelevatorfartz on 04.17.16 at 6:45 pm

And then you go to the grocery store and look at the price of meat…………

#13 Neuromancer on 04.17.16 at 6:46 pm

Most of Ontario? What about the Hamilton area,? Don’t you Know it’s the best place to raise a child, growing transportation hub, perfectly situated between the U.S. border and the Center of the Universe (T Dot). And Everyone in Toronto wants to invest here…more house for the money!
Why, just this week four more cribs in my ‘hood went up for bids. I think I’ll wait a little longer to cash in. The western oil depression wave hasn’t swept into Central Canada yet.

#14 Turtle on 04.17.16 at 6:48 pm

Looks like NDP in Alberta has a plan, but it takes 10 years to put it in place.

Does anybody know for how long the house can stay empty and unoccupied before it deteriorates in trash? Is it 10 years?

Do you see the connection here?

#15 Gulnar on 04.17.16 at 6:49 pm

First to read I guess

#16 Scumop on 04.17.16 at 6:49 pm

“In Alberta, Premier Notley threw up her hands and said the spending wouldn’t stop…”

Businesses are hurting. People are hurting. But why should the government have to cut back? Why should it be hurting in any way? Why should it have to slow down its empire building and junket lifestyle? Stationary bandits per historical tradition.

Less depressing, this somewhat educational video on Keynes vs Hayeks economic thinking…

http://www.youtube.com/watch?v=d0nERTFo-Sk

A “nerdgasm” according to RationalWiki.

#17 WUL on 04.17.16 at 6:51 pm

I am annoyed (as well as being annoying).

Become a billionaire in Canada = instantaneous Order of Canada.

Unstinting devotion to the improvement of our lives in Canada (sometimes right and sometimes wrong) like the host of this much ballyhooed yet pathetic blog = zilch.

I am going to contact the MP for my riding in Cowtown where my shack is.

Ooops, forgot. His last name is Harper. Oh well.

Best wishes Turner from the sweltering Taiga.

#18 BOOM! on 04.17.16 at 6:58 pm

Looking at world stats lately, not just the U.S. or Canuckistan, the economies are slowing!

Whether this is oil related, debt related, or demographic related, hey, that’s all well above MY pay grade!

As a retired old goat, who managed to make more than he did when working last year, not a bad world.

Still, not everybody will be so prepared, or not surprised, when the Ritz hits the fan. It appears to be heading closer to said fan based on what I have been reading.
While the recovery has been real, the numbers have also been relatively weak – the weakest recovery yet recorded, and it is now demonstrably slowing up.
(too many sources to list actually).

I am not making any changes, got diversified, got protections, got some cash, and a house (less than 20% of the whole). locally, economy is ‘steady’ neighbor’s home is listed for $199K __I think he’s dreaming, but there were lots of cars at the open house today, maybe I’m the one out of touch?

DEBT is NOT going to be your friend in an environment like that. Nor is asset concentration in a single area.

Could that happen to a child of the 60’s? ….what???…

#19 Randy on 04.17.16 at 7:01 pm

How I survived the Bubble Economy.

#20 streattlk on 04.17.16 at 7:04 pm

ok the sum of all this blog is:
diversify your investments.
period.
can we move on?

#21 Freedom First on 04.17.16 at 7:09 pm

Yes. Expectations, assumptions, self pity, criticism, blame, greed and fear, are things that I avoid at all costs. The discipline to do so takes years of practice, but are always extremely well rewarded. Most people are not interested in this approach. However, there is people who have not been fully destroyed by our education system, and remain open minded and willing to learn how to think for themselves.

Word of caution, keep your thoughts to yourself in face to face talks with family, friends and co-workers. As the Canadian consumers debt levels show, you will only make them angry. Hell, Garth even did a Blog on closing the GF site down if the anger and hostility did not abate.

#22 Joe2.0 on 04.17.16 at 7:09 pm

Investigation in the process regarding oversea buyers getting the first crack at Cdn RE.

#23 Russ on 04.17.16 at 7:12 pm

Thanks for the reality check Garth.

The quarterly statements came in and it all looks good again, but nothings quite done yet. Is it?

I’m sitting on Canada’s big island warmed by the sun, with a beer, after that nice afternoon ride on the motorcycle I took when I checked on the yacht.

We’re living about 20 percent on the good side o’ the rule of 90 and I wonder about the little people. They complain when it rains or when the trees are sexing (f*cking pollen) but you don’t hear a peep from ’em when it’s gorgeous. It’s the recency bias I guess.

#24 Bonhomme Carnaval on 04.17.16 at 7:15 pm

Ignorance is Bliss.

#25 Gramps on 04.17.16 at 7:16 pm

Where is the Canadian version of Trump when ya need him?

#26 Victoria Real Estate Update on 04.17.16 at 7:18 pm

In 2005-06 Americans also thought it was different and that those who were waiting for lower prices would miss out.

They thought that buying a home was a guaranteed investment winner since their government wouldn’t let house prices fall and allow millions of families to face financial ruin.

They were wrong. Their government couldn’t stop the inevitable price decline that finally came.

House prices in many American cities fell 50-60%. Some of the most notable price losers were American west coast cities and cities in Florida and Arizona where the warm weather was supposed to prevent any sort of price decline.

But you think it’s different in your Canadian city.

Think again. And take Garth’s advice.

#27 crowdedelevatorfartz on 04.17.16 at 7:18 pm

Is Brazilian President Dilma impeached yet?

#28 the Jaguar on 04.17.16 at 7:19 pm

Poor Ft. Mac. It’s worse than you know. Imagine the poor guy who isn’t just under water on his residence, but owns a few rentals. It’s like Black Hawk Down. ” “Meanwhile back at the ranch (Calgary)” the herd still thinks this is just a temporary situation. A ‘cycle’. Really? Renewable energy isn’t just some vague idea to aspire to anymore. It’s becoming a reality. Faster than we thought. Electric cars, new discoveries in alternative energy storage, the sharing economy, biking to work, cleaner, smarter energy sources. Less than 15 years ago we stored data on floppy discs. Look where we are at now. The same will happen with renewable energy.
And in the meantime, Iran, Saudi, Russia, Iraq just don’t give a hoot if the western world is suffering. They can produce the same product for so much less.
The next stage will be the move away from the big cities. Who wants to live in Gotham City anyway?

#29 bubu on 04.17.16 at 7:24 pm

As long as NDP is running AB, Edmonton real estate is safe… Maye the prices will no go up in the next 3-4 years but they will not go down either….

#30 bob daniel on 04.17.16 at 7:28 pm

people be dumb i just sold my home do not know my future exactly but today was fun just some white folk troubles like trying to reach the bottle of merlot under the seat of my canoe it was awkward but after a bit of struggle i got it

#31 Strathcona on 04.17.16 at 7:29 pm

Its bad here in Grande Prairie, AB.

Plenty for sale, several open houses, few visitors. Its hard to get a uhaul trailer here, much of it has been rented out and left town. Only seen the moving trucks leaving town. The uhaul contractor pulls several empty trailers into town to fill the need.

We went from a vacancy rate of less than 1.4% a year ago, to 10.4% in December. Local RE board refuses to post current statistics on its website. It’s that bad.

Crime is up, more thefts, bear spray robberies and carjackings. All great things for RE values.

The money’s run out, many of those without skills were the first to be cut.

Now we have a new opec decision, and I have no idea where the new floor for oil prices will be.

#32 richard leblond on 04.17.16 at 7:30 pm

“In Vancouver, there are lots of kids of corrupt Chinese officials. Here, they can flaunt their money. ‘There are so many rich people in Vancouver, so what’s the point of showing off?’ he said. Asked what his parents did for a living, Jin said his father was a successful businessman back in China but declined to provide details. ‘I can’t say,’ he stammered with evident discomfort.”

http://news.nationalpost.com/news/canada/in-vancouver-there-are-lots-of-kids-of-corrupt-chinese-officials-here-they-can-flaunt-their-money

#33 Bonhomme Carnaval on 04.17.16 at 7:32 pm

To live is the rarest thing in the world. Most people exist, that is all.
-Oscar Wilde

A nation of gentlemen (and gentlewomen) dandies.

We have chosen the most appropriate leader…

Good night!

#34 COW MAN on 04.17.16 at 7:32 pm

The unfortunate thing about a democracy is that the majority rules, even when they are wrong. All that matters in Ontario is the opinion in 416 and 905. There are enough Federal Ridings in those two area codes, that as long as the Federal Government meets their agenda the beat goes on.

#35 AK on 04.17.16 at 7:32 pm

“They say oil prices could tumble again after big talks went sideways yesterday in Doha.”
====================================

I doubt the market was a expecting a miracle.

#36 Rexx Rock on 04.17.16 at 7:33 pm

So the moral of the story is only buy real estate in Toronto,Vancouver and Victoria.Lots of high wage jobs and where people want to live and raise a family.

#37 T.J.BONES on 04.17.16 at 7:33 pm

Sir Garth:

Here it comes !!!

#38 RayofLight on 04.17.16 at 7:40 pm

I went for my first ride today for the season. My neighbor also has an 82 Wing, so we just hit the back roads and zoned out for about 3 hrs and ended up at a Timmies. I think my heart rate actually goes down when I’m riding, thinking about stuff, charts & life in general. I am blessed.

#39 bob daniel on 04.17.16 at 7:45 pm

would i move through moderation faster if i mentioned that there was my wet black lab making the boat slippery! keep going garth you gotta see it through the shit tsunami of fed stupidity should be coming through soon

#40 45north on 04.17.16 at 7:47 pm

talking about unsold new houses: Obviously this means house prices are going to decline, since cash-starved builders won’t sit on more than half a billion dollars in inventory.

in the US, as prices fell, builders undercut owners. Pulled the rug out from under them.

So you don’t live in Newfoundland, Alberta (or Nova Scotia, Saskatchewan, New Brunswick, Manitoba or most of Ontario) and don’t care? That’s fine. But don’t let the lessons others are learning pass you by.

I suppose some people still have options. Like if you live in Vancouver or Toronto.

Here’s an article about Newfoundland: For weeks, Bennett had been pleading with Newfoundlanders and Labradorians to understand their government is no better off than they are.

http://www.macleans.ca/economy/bust-times-are-back-in-newfoundland-and-labrador/

#41 Randy on 04.17.16 at 7:50 pm

The Fed has Zero Credibility….Maybe not…They have entered the integer zone….minus numbers apply.

#42 lala on 04.17.16 at 8:02 pm

Nice find, small house, front and left graveyard view, insane 1.5 mil.

#43 lala on 04.17.16 at 8:03 pm

http://www.century21.ca/paul.indrigo/Property/ON/M5N1K5/Toronto/596_Roselawn_Ave

#44 BS on 04.17.16 at 8:19 pm

Why do I bother? Until human nature changes, people will live in the moment. Better make it a good one.

One part of human nature is greed. I keep hearing more and more how home owners here in YVR and YYZ now realize it is a bubble but are waiting for ‘the top’ to sell. Once this thing turns there will be a massive rush to the exits. How many people were able to get out of the Nasdaq at the top? Almost none and selling stocks takes seconds not months. People are going to learn an expensive lesson on greed.

#45 Old Man Too on 04.17.16 at 8:22 pm

BTW, the Porsche giveaway yesterday was for a commercial condo building.
Stratosphere Capital, which sells its southwest Edmonton property Windermere Plaza as a upscale hot spot for business and healthcare professionals — with “Silicon Valley-speed fiber optics” — is offering a brand new 2017 Porsche Boxster or Macan with every business condo purchase to emphasize its poshness.

#46 Frank on 04.17.16 at 8:28 pm

High oil salaries being lost caused the drops there? Sounds reasonable. Okay so what would cause the same in Vancouver? Oil hasn’t leaked over like you’ve been hinting at for months. The low dollar has caused movie production and tech to boom. So it’s easy to say “it could happen to you” but I don’t see a realistic cause.

#47 TurnerNation on 04.17.16 at 8:33 pm

Surely people know the goal of elites’ is to lead us into debt slavery via vainess, ego, peer pressure? Then pull the trap door and watch us swing. Neck and neck we are.

#48 Hawkeye on 04.17.16 at 8:35 pm

And then you get the Royal Bank ripping there investors off by offloading the Capital gains Tax onto Share holders as they did in the Tax Managed enhanced Fund and who can fight a big bank.

#49 Sideshow Rob on 04.17.16 at 8:37 pm

Like Micheal Campbell said yesterday… when one man knows nothing about economics it’s called ignorance. When millions know nothing about economics and get together it’s called the NDP.

#50 Love my Kia on 04.17.16 at 8:40 pm

42 lala on 04.17.16 at 8:02 pm

Nice find, small house, front and left graveyard view, insane 1.5 mil.
************************
Realtor take;

A view to die for!

#51 slick on 04.17.16 at 8:40 pm

In Alberta, the only thing different this time, is that there will never be a new oil sands facility built.
oil companies won’t stomach the cost,
and the enviro’s won’t tolerate the mess.
there may be some expansion to the units in place, but nothing new.
there I said it.

slick

#52 crowdedelevatorfartz on 04.17.16 at 8:43 pm

@#10 Jimmy
Whew!
Late today.
Thought it was the end.”
********************************************

LATE?

Are you kidding me?

ITS SUNDAY!

Just be glad Garth is actually putting up a new post on a SUNDAY!!!!!!!!!!

Unbelievable.

#53 to on 04.17.16 at 8:46 pm

i watch this slow movement to ruin…i have relatives that are already carrying the second condo at a loss…these people work at hd and don’t contribute to the pension plan because re only goes up in bc…i’m so afraid for them…i’m also afraid for me…old and a younger class that gets wiped out…hope for a good outcome…tom

#54 oil opens -6.19% on 04.17.16 at 8:53 pm

#35 AK on 04.17.16 at 7:32 pm

“They say oil prices could tumble again after big talks went sideways yesterday in Doha.”
====================================

I doubt the market was a expecting a miracle.

===

Just after the futures market opened around 6 p.m. ET, West Texas Intermediate crude fell 6% to as low as $39.02 per barrel.

On the whole, the oil price crash has reduced Canadian income by about $1,800 per capita. That is, economic damage has been so significant that the country has already seen almost $2,000 of wealth evaporate for every man, woman, and child across the country. Oil investments accounted for 56 percent of total investments in Canada in 2014, and the damage to the Great White North has already knocked roughly 1 percent off of GDP. Roughly 70,000 jobs have been lost in the three main energy producing provinces of Alberta, Saskatchewan, and Newfoundland and Labrador which in turn pushed the jobless rate up by 2-3 percent.

These negative effects already appear to be largely baked into the price of Canadian stocks. The iShares MSCI Canada index ETF has fallen by more than 20 percent from its highs in late 2014 even after a modest rebound in the last month. Canada’s economy is in far better shape to weather the storm than some other major oil producing nations, but the pain is still palpable.

http://www.businessinsider.com/long-term-ipact-oil-crash-canada-2016-4

#55 acdel on 04.17.16 at 8:54 pm

People no longer care due to the fact we are expected to continuously pay for politicians that have no long term vision; it’s all about buying the next vote. Corps raise prices overnight to the extreme for no justifiable reason.

Most countries have debt that can never be paid back. The situation in the Middle East with low oil prices will not end well, they need $100 oil to continue to pay for there social programs, no or very little tax, free education, infrastructure etc. Affordable alternative energies are decades away.

Diversify!

Good blog Garth.

#56 Dean Mason on 04.17.16 at 9:00 pm

Interest rates will not be going up much in the next 10 to 15 years from current levels.

I suspect they will go down more in the next 5 years before and real, meaningful increase after that.

Anyway, I maxed out my TFSA’s in the last 7 years and RRSP’s over the last 15 years. I finally through in the towel in 2015.

My $528,000 will mature in 2036 to 2037 government strip bonds, zero coupon bonds worth $1,128,000.

I just paid off my mortgage last month and have no debts at all. I don’t have to make 6%, 7%, 8% non compound rates of return.

I have a good tenant paying me $1,300 a month rent and my total monthly housing expenses, taxes, utilities are currently only $750 a month. I don’t need to own a car and rent, car share when needed.

I quit my full-time job 6 months ago and that was the best thing I ever did. I only need to work part-time by contract 20 hours a week, $400 a week net pay and still am putting the maximum of $5,500 a year in my TFSA and $4,500 a week in my RRSP and $5,000 in term deposits, cashable GIC’s, 1.75% savings account.

I am not going to work full-time of 45, 50+ hours a week just to pay the bank and have a house paid off when I am 65 years old.

#57 Dean Mason on 04.17.16 at 9:02 pm

I meant $4,500 a year I am putting into my RRSP not a week.

#58 For those about to flop... on 04.17.16 at 9:07 pm

One for all the people worried about Brazil…

M41BC

https://imgur.com/opsg9yL

#59 feldspar on 04.17.16 at 9:19 pm

Interesting comments , Turner Nation – you were really on a roll. I don’t know what you’re smoking, but I wish you would spread it around.
Someday, somehow, sanity must return to reject our Canadian
march to socialistic nirvana- and the excesses of the public service sector,and its unbridled power and inefficiency may be the first hole in the dike to awaken the sheeple. maybe. What a mess.

#60 pinstripe on 04.17.16 at 9:23 pm

the taxpayers in Edmonton have a lot of money.

http://www.cbc.ca/news/canada/edmonton/edmonton-s-former-city-manager-spent-200-days-travelling-on-taxpayers-time-and-money-1.3538665

#61 Fed-up on 04.17.16 at 9:26 pm

Calgary, sales are down 8%, listings are also rising and the average price is 1.8% higher than a year ago. That’s less than inflation – and way less after you pay commission to sell.

————————————————————————————

Seriously, prices went up??? I don’t think the inflation thing and commissions mean much to anyone who is buying. Only that they have to pay almost 2% more than last year when prices should be collapsing.

Crazy.

#62 joblo on 04.17.16 at 9:26 pm

Doh! a
Really, they could never even agree on the time of day.
Who is shocked?

#63 A Grim Future on 04.17.16 at 9:34 pm

So as a rough calculation, two thirds of all Canadians (whose house is their only asset) would be approximately 20 million people. As a rough guess, the over 45 crowd would be all Boomers and quite a few of the Gen X group as well. As a rough approximation, this would be 12 million people who are over 45.

If 60 percent of this group (7,200,000) have mortgages and nothing else, this means that if they lose a significant portion of the value of their single asset, then at least some of that group will owe more on their mortgage than the house is worth. If we use the figure of debt to ratio of 167 percent as the average for all Canadians and we apply that to the 7,200,000 mortgage holders, then we arrive at the figure of 3,600,000 people who are at or above that average.

What little I know about a normal (Gaussian) distribution tells me that about two thirds of the sample representing a population are within a band of one standard deviation on either side of the average. This represents a spread of two standard deviations centred on the average. So one sixth of the population is well above the 167 percent debt to income.

To tie this all together, and to stop my brain from hurting more, it appears that one sixth of the 3,600,000 or 600,000 people are so far above the 167 percent ratio as to be put into a group that some might say are lost souls. If house prices fall they will be unable to recover and thus will be impoverished. Add to this the fragility of people’s employment in these difficult and interesting times, particularly for the 50+ then we have, possibly, very bad times ahead for a lot of people.

#64 Figmund Sreaud on 04.17.16 at 9:36 pm

They say oil prices could tumble again after big talks went sideways yesterday in Doha. That would suck.
_____________

That will suck!

Let’s face it, … Saudi Arabia and Russia are not contributing much to the current oil over-supply: … maybe only 330,000 bbls/day? Maybe, …

The principal contributors to over-production – the U.S., Canada, Iraq, Brazil and Iran – were not involved in the
freeze discussions. Production from these countries was 2.8 million bbls/d more in Feb. 2016 than in Jan. 2014.

2.8 million bbls/d is more than the current world production surplus!

Note: 1.2 million bbls/d was from the U.S. and 1.1 million bbls/d from Iraq. Russia added 0.33 million bbls/d. Iran production increased 0.15 million bbls/d from December 2015.

Anyway, …

“There is no sense in wasting our time in seeking production cuts. That will not happen.”
–Ali Al-Naimi in Houston, February 26, 2016.

Still wondering why?

F.S. – Calgary, Alberta.

#65 David Digger on 04.17.16 at 9:46 pm

I built my last house in ’92. Interest rates were 16.75% We were into the BNS for several million for an upscale subdivision in Richmond BC. When the market stalled I lowered prices from 1.2 to 920 for a ‘quick sale’….managed to find a buyer for each house….with each unit having cost me $80 grand in interest. Although I came out with a profit I was glad I lowered prices quickly before the market collapsed and lay flat on it’s back bleeding red ink for the next 12 years. Shit happens…deal with it quick. The recency effect my have some people thinking there will be a V recovery in activity and prices….RE doesn’t work that way….when it tanks it tanks big and long.

#66 Market Inquisitor on 04.17.16 at 9:47 pm

New oil related post on the failure of the Doha talks and current oil futures positioning.

https://marketinquisitor.com/2016/04/17/crude-positioning-pain/#more-1138

#67 RimJabba on 04.17.16 at 9:53 pm

Fasten your seat belts, it’s going to be a bumpy ride from here in. Garth if you can’t see the triple top forming in the DJIA you need your old man specs checked. Stocks are heading for a beating once the defaults start rolling in, probably around June.

I’m picturing $15/barrel oil by mid summer. BoC doesn’t even see the financial warfare going on, they are like the dumb kid who eats paste in school.

Keep buying real estate, the higher it goes the harder it will crash.

#68 common sense on 04.17.16 at 9:56 pm

So when the bubbles blow this time, any predictions on the price of oil?

I’m calling $10 a barrel…

#69 Ben on 04.17.16 at 9:57 pm

I’ve no sympathy for speculators buying up houses to rent / flip. But many caught up in this are young families scared of “missing the boat”.

The real problem here is the banks. People think banks loan out existing money and allow people to “invest” in housing. This is incorrect and they are filth.

Fix banking and fix everything.

#70 TRUMP on 04.17.16 at 10:00 pm

“Only when the tide goes out will we see who’s been swimming naked”
__________________________________________

Warren Buffett

#71 cowtown cowboy on 04.17.16 at 10:02 pm

Just got back from Palm Springs and overheard some young turks(likely in for Coachella) from Vancouver. They were chatting up some girls in the pool and lo and behold the topic of conversation was the price of housing in Van…unreal..

#72 nonplused on 04.17.16 at 10:05 pm

I’m trying to live in the moment Garth but the last time I got a “three-some” my wife and her friend fell out, mostly because the friend started freeloading. Sigh. Why can’t girls get along? Oh well I guess it’s something you do when you are young, as one of my coworkers suggested before turning bright red and heading for the washroom.

#73 crowdedelevatorfartz on 04.17.16 at 10:09 pm

@#56 Dean Mason
When you finish planning your perfect scenario for retirement in 2036 and tear yourself away from collecting navel lint………pray tell.
Please let us know what next weeks winning lotto numbers are…….

#74 crowdedelevatorfartz on 04.17.16 at 10:13 pm

Garth.
Any comment on the future ramifications of underfunded public employee pensions with overly optimistic predictions of future earnings affecting private sector pensions and taxes?

#75 WUL on 04.17.16 at 10:16 pm

I used to fret about the silly notion that the environmental hangover that Albertans are about to wake up to with the abandonment of the oil sands would hammer my kids. I started to contemplate that they would have to leave this province to have a future.

I have wailed about the privatization of profit and the socialization of cleanup costs. Love Canal X 2000.

Now I am sanguine. Cleanup will not fall to the public purse. There will not be a clean up and remediation.

The mess will simply flow northward up the Athabasca River, through Lake Athabasca, the Slave River and the Mckenzie River to the delta.

Party on!!!

#76 Figmund Sreaud on 04.17.16 at 10:30 pm

PISSED [check mark]
___________________________

Death knell, … the tolling bell!

“People are not voting for Trump (or Sanders). People are just voting, finally, to destroy the establishment.”

– Nassim Taleb, of “Black Swan” fame!

Anyway, … just the first rumble of a tectonic shift that will leave very few things unchanged!

F.S. – Calgary, Alberta.

#77 Star Stuff on 04.17.16 at 10:34 pm

Way to go Brazil.. the BRICS are pretty close to the PIGS

http://www.theglobeandmail.com/news/world/brazils-congress-votes-to-impeach-president-dilma-rouseff/article29657243/

#78 WalMark of Sadkatoon on 04.17.16 at 10:36 pm

http://www.cbc.ca/news/canada/toronto/toronto-housing-prices-through-the-roof-in-1988-1.3538045

blast from the 1988 past

#79 Brazil ex-pat on 04.17.16 at 10:39 pm

#27 crowdedelevatorfartz on 04.17.16 at 7:18 pm
Is Brazilian President Dilma impeached yet?

+++++++++++++++++++++++++++++++++++

They are working on it yes. See….in Brazil they actually “put criminal politicians and bankers in jail”. In Canada and the USA they just pay a fine. Cost of doing business (at the expense of the public of course).

#80 Brazil ex-pat on 04.17.16 at 10:47 pm

#74 crowdedelevatorfartz on 04.17.16 at 10:13 pm
Garth.
Any comment on the future ramifications of underfunded public employee pensions with overly optimistic predictions of future earnings affecting private sector pensions and taxes?

++++++++++++++++++++++++++++++++++++

higher and higher and higher taxes. This is happening everywhere in the world. We have reached Peak Government.

#81 B on 04.17.16 at 10:49 pm

It’s actually St. John’s, Newfoundland. There’s Saint John in New Brunswick.

As stated. Saint John’s. A fabulous city. — Garth

#82 Ole Doberman on 04.17.16 at 11:34 pm

“national spokesperson for the Alzheimer Society of Canada.”

Gartho how did you get involved in this cause and why? Just curious….its good though man!

As with most people, through family experience. — Garth

#83 WalMark of Sadkatoon on 04.17.16 at 11:37 pm

200+ days on market in Fort Mac and only 16 days on market in YYZ??? Where am I???

#84 Ace Goodheart on 04.17.16 at 11:55 pm

Predicting the fall of the Alberta and Newfoundland real estate markets was as easy as predicting the downfall of Blackberry (once you could get portable email on every cell phone with a data link, and they started giving away cell phones for free, why do you need an expensive Blackberry device?)

Predicting Vancouver and Toronto is not easy.

I haven’t read a post on here, or a blog topic, that has adequately explained what is happening in those two places.

And neither Toronto nor Vancouver is currently experiencing a price decline (Toronto is continuing the upward trend into the red hot spring market).

So we still don’t have an adequate explanation for what is happening in those two markets.

#85 Katherine on 04.18.16 at 12:11 am

Garth, help me to stay strong. We live in North Vancouver and we could buy a townhouse or even a house if we wanted to BUT we would not have a lot left over for savings. I talk about your blog and tell people we are waiting until things are more affordable and that we don’t want to be house poor. Everyone I talk to either laughs in my face or calls me an idiot. They say it will never happen. It is now or never. They make me feel like I am Linus waiting for The Great Pumpkin’s arrival. Now I am starting to think maybe we should just buy. What if what they say is true and we will never be able to afford anything, ever? We currently rent a townhouse but would love more space and a yard for our 4 year old. I feel like maybe we really are fools for not buying.

#86 Frank on 04.18.16 at 12:35 am

If prices can’t even drop in Calgary when oil is a third what it was a couple years ago then I don’t think your correction is coming any time soon.

Despite the insistence that a balanced portfolio is a good idea that’s 20th-century advice. In this age, housing beats stocks.

#87 family beagle on 04.18.16 at 12:45 am

‘Moment’ is an old term referring to the precise instant a load bearing branch snaps, usually where it veered off from the main stalk.

#88 Mark on 04.18.16 at 1:19 am

“Add to this the fragility of people’s employment in these difficult and interesting times, particularly for the 50+ then we have, possibly, very bad times ahead for a lot of people.”

Absolutely. The other problem perhaps not considered in your statistics is that the big buyers of RE over the past decade are those who have had incomes correlated to rising RE and rising prosperity arising out of RE. So these groups face sort of a double whammy; reduced income in combination with negative equity.

People in out of favour sectors such as IT, manufacturing, engineering, etc., have not been the big buyers of RE over the past decade. Thus, they stand not to suffer quite as much. With any luck, the economy will undergo a process of rebalancing, and actually create demand in those sectors which, in the post-tech-bubble collapse era, appear to be significantly negatively correlated with RE.

“And neither Toronto nor Vancouver is currently experiencing a price decline (Toronto is continuing the upward trend into the red hot spring market). “

There is ample evidence of price stagnation, and the Realtor reported transactional average price “increases” only being on account of a dramatic shift to the sales mix caused by first time buyers basically disappearing.

200+ days on market in Fort Mac and only 16 days on market in YYZ???

The contemporary problem in the GVR/GTA is not lack of inventory, but rather, individuals reading the newspapers “think” that their house price has gone up. They go to see their Realtor, who brings out a book of “comps”. The “comps” show no price increases over the past 3 years, if not slight price decreases — after all, “comps” are against reasonably similar properties and are not influenced by the sales mix shift. So they simply don’t list.

When the Realtors can no longer play the game of quoting rising numbers (on account of the sales mix) on account of demand exhaustion in the higher-end of the market — the whole thing falls apart, and an avalanche of supply comes to market in a panic.

Any comment on the future ramifications of underfunded public employee pensions with overly optimistic predictions of future earnings affecting private sector pensions and taxes?

I expect governments to subtly chop away at the public employee pensions. One year, it will be a reduction in post-retiree drug plans. The next it will be dropping an eye care benefit. If things get too bad, the market will do it for them through higher inflation that will not come to be reflected in indexing calculations.

Ultimately any sort of investment or pension schema is dependant on the young continuing to work to pay those benefits. Any scheme that unduly enriches the retired at the expense of the working is doomed to failure. Anyone who has a pension or investments should be alarmed at how poorly the economy in the past 10-15 years has been integrating youth into the workforce and society.

#89 Tim on 04.18.16 at 5:23 am

I’m trying really hard to keep renting but our landlord is always AROUND making so much racket we can’t have any peace, sigh.

At least we don’t have any other debt I even own my car.

#90 Thanks for the vid link... on 04.18.16 at 7:01 am

#78 WalMark of Sadkatoon – thank you for that link to what RE prices and thinking in 416 were like in the late 80s.

Lived there then. Price drop after the correction to 1996 was over (1989 the high point) was:

-27.6%

Another post in the last couple of days about YVR RE price drop in the 80s, about the drop being rapid followed by protracted stagnant RE prices (12 years or so) was mirrored in 416 per the article albeit it took longer to drop.

Imagine this happening to YVR and 416 nowadays…a bloodbath in capital loss will result as Garth points out today.

#91 acdel on 04.18.16 at 7:14 am

Good article:

http://www.cbc.ca/news/business/real-estate-market-psychology-1.3537384

#92 Linda on 04.18.16 at 7:20 am

Canadians should not that while dinosaur bashers criticize Trudeau here, the world is noticing his profound intelligence.

Much, much smarter than he is given credit for, and leaps and bounds ahead of the pathetic IQ of that lipstick and mascara wearing ‘economist’ fraud, Stephen Harper.

http://fortune.com/2016/04/17/justin-trudeau-quantum-computing/

Our economy is in good hands. Thank heavens we kicked out the idiots.

Manitoba might want to consider carefully the cost of electing more neocon dinosaurs.

Perhaps T2 can now Google ‘deficit.’ — Garth

#93 Linda on 04.18.16 at 7:55 am

So 60% of people over age 45 have a mortgage. Well, given that most people do not go for the paid off in 15 years option despite the undeniable financial advantages but instead go for the 20, 25 or even 30 year option this is not a big surprise. Say you are age 25 at time of house purchase/mortgage. Obviously if you go for the longer term – 25 years being a traditional choice & with these low interest rates likely the preferred choice – you would not pay that sucker off until age 50. This also presumes one does actually pay it off in 25 years & does not extend the lifespan in order to have cash for other things one wants…..

#94 TurnerNation on 04.18.16 at 8:03 am

#59 feld appreciate the shout out.
No smoking only healthy lifestyle

The key to success is believing in the power of evil, it’s massive spread and reach. Then, making a choice and refusing to sell.

Forget all those nonsense feel good seminars. You need to ferret out and study and handle and get to know the worst in yourself and others. The rest is innate.

Years ago a book was recommended to me. M. Scott Peck’s “The people of the Lie”. Sure it’s written from a certain faith perspective but you can discard that if you want and take the grist.

#95 TurnerNation on 04.18.16 at 8:19 am

Funny, I once worked for a devout Jewish guy. While I have no affinity toward that belief system something he said stuck with me: The purpose of life is to build Spiritual Capital.

Interesting to note my two friends – guy and girl – I see a few x each week and text also happen to be Jewish though a bit less observant.

#96 common sense on 04.18.16 at 8:29 am

#79 Brazil Ex-Pat

Well said. I love the FACT Brazil and countries like ICELAND actually TAKE ACTION, rise up, arrest and punish those in power who lie and make greedy decisions tax money received from the people of the country which was supposed to be spent with the purpose of ASSISTING the people of the entire country, not a choosen few…

Compare this to NORTH AMERICA where here in Canada us sheep would cheer another “Commission” to “study and investigate” the problem for years, wait for “recommendations” then wait another 3-10 years in “hope” anything is ACTUALLY done to change things for the better, very similar in the USA.

BAAA BAAA BAAA. No I am never calling for violent revolution but speak up people or continue bending over and saying BOHICA.

Long live ACTION over WORDS.

#97 crowdedelevatorfartz on 04.18.16 at 8:51 am

@#79 Brazil Expat.
“in Brazil they actually “put criminal politicians and bankers in jail”
*******************************************

Bwahahahaha.
She’ll be booted from office in May.
The Impreachment proceedings will drag on for months if not years until no one cares, then she’ll be fined, banned from politics for a while and serve no jail time….just like the bankers and politicians in north america. You see, they drag things out in the Court system til no one cares…its been going on here for years
Brazilian democracy and politics has a lot of catching up since the 1980’s military dictatorships but they’re learning from the US and Canada real quick.

Hows that “worst recession since the 1930’s” workin for ya? The ‘real” devaluated much since Jan 1st?

#98 Janice Jaylene on 04.18.16 at 9:10 am

To Crowdedelevatorfartz

I know how Dean Mason feels. I had many opportunities to buy longer term government bonds, strips from 1997 to 2008.

It has been 9 to almost 20 years since interest rates were in the 4.5% to 6.5% range.Now at best they are in the 2.5% to 3.5% range.

According to my calculations, his $528,000 grows by $600,000 over 21 to 22 years. This is about $28,000 to $29,000 a year or about 5.3% to 5.5% a year.

My friend talks regularly to his relatives in China and noticed that over the last few years a big drop in interest rates there too. The China’s stock market meltdown of almost 50% made things worse since 2008.

They could easily get 5% to 5.5% just a couple of years ago but now 3.00% to 3.5% and they are stilling dropping.

I would side on the camp that interest rates will not go up much if at all for the next 5 to 10 years at the very least.

This is not the 1980’s and 1990’s anymore.

#99 Janice Jaylene on 04.18.16 at 9:18 am

This is not the 1980’s and 1990’s anymore where average interest rates on GIC’s, government bonds averaged anywhere from 6% to 7% a year with highs of 19% to lows as 5.5%.

#100 Guy Fawkes on 04.18.16 at 9:22 am

#81 B
It’s actually St. John’s, Newfoundland. There’s Saint John in New Brunswick.

As stated. Saint John’s. A fabulous city. — Garth

I correct all the time. If you not from one of those provinces, who cares. very common mistake with some funny travel results.

https://goo.gl/3gHqvO

#101 TurnerNation on 04.18.16 at 10:07 am

Look at how Toronto’s “hero” allegedly behaves. Kick these types to the curb. Total nonsense we are fed.

http://www.blogto.com/music/2016/04/so_apparently_drake_doesnt_like_getting_his_photo_taken/

Drake and his woes, however, weren’t too pleased about this. The rapper, apparently, hopped over a six-foot-high wire fence and approached Small. Drake allegedly started taking pictures of Small and he and his friend tried to get the hobbyist to delete his photos – as the Star writes, one person even tried to grab Small’s camera.

#102 salonist on 04.18.16 at 10:48 am

China March home prices rise at fastest rate in two years, top cities boom

The southern city of Shenzhen continued to be the top performer, with home prices surging 61.6 percent from a year ago, followed by Shanghai with a 25 percent gain.

http://www.reuters.com/article/us-china-property-homeprices-idUSKCN0XF058

#103 For those about to flop... on 04.18.16 at 10:55 am

[email protected]

The contemporary problem in the GVR/GTA is not lack of inventory, but rather, individuals reading the newspapers “think” that their house price has gone up. They go to see their Realtor, who brings out a book of “comps”. The “comps” show no price increases over the past 3 years, if not slight price decreases — after all, “comps” are against reasonably similar properties and are not influenced by the sales mix shift. So they simply don’t list.

When the Realtors can no longer play the game of quoting rising numbers (on account of the sales mix) on account of demand exhaustion in the higher-end of the market — the whole thing falls apart, and an avalanche of supply comes to market in a panic.

//////////////////////////////////

So what should my neighbors do with the extra half a million they pocketed for waiting until this year to sell as opposed to 2013 which was the peak in your mind?

Do you know of a good sales mix charity that they can donate this money to since they should not have got it?

Sometimes you hit the dartboard,sometimes you hit the pinball machine…Ross Kay is currently playing the pinball machine and said to stop hitting him in the ass with your darts…

M41BC

#104 Renter's Revenge! on 04.18.16 at 11:09 am

#98 Janice Jaylene on 04.18.16 at 9:10 am
“To Crowdedelevatorfartz

I know how Dean Mason feels…”

Oh, the irony!

Usually the personalities associated with someone’s multiple personality disorder don’t know about each other.

#105 Observer on 04.18.16 at 11:13 am

With OPEC Doha deal collapsed, Poloz should quit trying to revive the dead oil horse with low rates. Ain’t gonna happen Steven. Inflating his obscene housing bubbles in TO and Van along with pricey imports is causing hardship for young families trying to find affordable housing. Do the right thing Steven and raise rates.

#106 fancy_pants on 04.18.16 at 11:52 am

The gov’ts set up the game to reward RE speculation and then they wonder why it happens? And why not live in the moment, the gov’t has made it clear it is selling out the future.

Diplomacy, like liberty, is being sold out to the lowest common denominator.

#107 killyouforanickle on 04.18.16 at 11:55 am

“Perhaps T2 can now Google ‘deficit.’ — Garth”

I’ve heard of single issue voters before. Is there such thing as single thought humans?

#108 For those about to flop... on 04.18.16 at 12:00 pm

Aw geez,CNN just ran the clip of the Metrosexual Messiah doing his quantum computing spiel and the two anchorettes were swooning…style over substance ,I guess.

No word yet if they are going to have Mike Duffy on as a guest to explain the importance of declaring your travel expenses and primary residence correctly…

M41BC

#109 ok ok ok on 04.18.16 at 12:23 pm

Hello bears,
Everybody has a story about rich foreigners buying left
and right, 9 out of 10 of your coworkers will tell you are stupid to wait, your family laughs at you, everybody in construction industry is making double than you and on and on.
What nobody tells you and even Garth was barely touched it is the non regulated private mortgage sector growth, where people are HELOC-ing their homes, pooling their moneys and lending downpayments for fools at 6-8%. Also 2nd and 3rd mortgages at the same insane levels for people that lost their jobs. That is the reason Alberta has not totally collapsed yet, but if Doha’s meeting is any sign it will start to crack faster than expected.

#110 Brazil ex-pat on 04.18.16 at 12:55 pm

#97 crowdedelevatorfartz on 04.18.16 at 8:51 am
@#79 Brazil Expat.
“in Brazil they actually “put criminal politicians and bankers in jail”
*******************************************

Bwahahahaha.
She’ll be booted from office in May.
The Impreachment proceedings will drag on for months if not years until no one cares, then she’ll be fined, banned from politics for a while and serve no jail time blah blah blah fart fart …….

++++++++++++++++++++++++++++++++++

http://www.xe.com/currencycharts/?from=BRL&to=USD&view=1Y

First of all….go read a chart. The Real is up….

Second….they put people in jail there. My point stands. They do NOT put politicians and bankers in jail in the USA or Canada.

#111 WalMark of Sadkatoon on 04.18.16 at 1:02 pm

Sometimes you hit the dartboard,sometimes you hit the pinball machine…Ross Kay is currently playing the pinball machine and said to stop hitting him in the ass with your darts…

this visual made me lol!

i love how he mentions ‘Ross Kay’ as if it means something lol!

#112 WalMark of Sadkatoon on 04.18.16 at 1:03 pm

The contemporary problem in the GVR/GTA is not lack of inventory, but rather, individuals reading the newspapers “think” that their house price has gone up.

lol this is wrong too!

#113 Samba Dancing on 04.18.16 at 1:24 pm

A tad short sighted….
http://www.xe.com/currencycharts/?from=BRL&to=USD&view=5Y
——-

#110 Brazil ex-pat on 04.18.16 at 12:55 pm

#97 crowdedelevatorfartz on 04.18.16 at 8:51 am
@#79 Brazil Expat.
“in Brazil they actually “put criminal politicians and bankers in jail”
*******************************************

Bwahahahaha.
She’ll be booted from office in May.
The Impreachment proceedings will drag on for months if not years until no one cares, then she’ll be fined, banned from politics for a while and serve no jail time blah blah blah fart fart …….

++++++++++++++++++++++++++++++++++

http://www.xe.com/currencycharts/?from=BRL&to=USD&view=1Y

First of all….go read a chart. The Real is up….

Second….they put people in jail there. My point stands. They do NOT put politicians and bankers in jail in the USA or Canada.

#114 Fed-up on 04.18.16 at 1:40 pm

#85 Katherine

Everyone I talk to either laughs in my face or calls me an idiot.

——————————————————————————-

When they do that, just pull out returns of the last 5 years of your balanced portfolio.

Oh wait…hold off on that for a bit.

It is not a competition between putting all your net worth in a house for unrealized capital gains and serious overhead, and a liquid portfolio which fluctuates more and costs little to hold, but about finding balance. — Garth

#115 For those about to flop... on 04.18.16 at 1:49 pm

at 1:02 pm
Sometimes you hit the dartboard,sometimes you hit the pinball machine…Ross Kay is currently playing the pinball machine and said to stop hitting him in the ass with your darts…

this visual made me lol!

i love how he mentions ‘Ross Kay’ as if it means something lol!

//////////////////////////////////

How’d I know you would be all over that one like shit on a blanket.
There a plenty of posters on here throwing around numbers on Vancouver real estate and people in other parts of the country might think these people are exaggerating what is happening here but they are not.

THINGS HERE ARE OUT OF CONTROL.

Mania,obsession and parabolic are some of the words tossed around but they are so last year, things have gone up a notch since then.

Its like that pesky shopping cart you get at the supermarket…you know what is supposed to happen and where you want to go but the thing has a mind of its own…

#116 CRA is corrupted? on 04.18.16 at 2:03 pm

“CBC News has documented more than 50 hospitality events, including “tailgate parties,” “cocktails” and “food and drinks” at numerous tax industry conferences since 2010. The events were attended by CRA executives and employees, and sponsored and paid for by tax industry associations and accounting and law firms across the country — the very firms the agency is responsible for regulating, auditing and, on occasion, penalizing.”

Benger says he was “stunned” by the relationship he observed between the tax law companies, the accountants and the CRA. He argues the “rule makers” were too close to “rule twisters.”

Its amazing how delusional and out-of-touch the CRA is these days. Time to get the RCMP involved and clean-house.

#117 Mark on 04.18.16 at 2:13 pm

“So what should my neighbors do with the extra half a million they pocketed for waiting until this year to sell as opposed to 2013 which was the peak in your mind?”

The “extra half a million” in most cases simply doesn’t exist, and is a figment of their imagination.

If they didn’t sell in 2013, how do they know that they wouldn’t have gotten a half million above what they believe the 2013 “price” was? They don’t.

There could be a house, or a neighbourhood that experienced such, but that’s certainly not generalizable to the entire population of GTA/GVR properties. It would be an extreme exception to see that sort of appreciation (even if we convert to a percentage, rather than an absolute value, on an individual property), not the rule as the Realtors run around claiming when they fail to acknowledge the shift in the sales mix.

#118 common sense on 04.18.16 at 2:21 pm

#108 Flopper

It’s Mike Puffy..not Duffy.

For further reference.

Thank you.

#119 Dups on 04.18.16 at 2:30 pm

As long as the masses believe homes are an investment, things will not change. If they only did the math and crunched the numbers they would be disappointed to find out how poor of an investment they are. Off course I am talking about normal areas of the country. No 416 and whatever the rest is called. This is abnormal and it is fuelling even the markets that were not so hot before. A house is a place to live.

#120 Frank on 04.18.16 at 2:47 pm

not the rule as the Realtors run around claiming when they fail to acknowledge the shift in the sales mix.

Still going on about sales mix huh? Give it up.

#121 understood by few on 04.18.16 at 2:53 pm

Perhaps T2 can now Google ‘deficit.’Garth

————–

Thanks Garth. This is why I bother to read the comments. It made my morning (after a weekend of avoiding news articles about how amazing it is T2 can recite a script).

On a side note: WTF is up with the CAD? Oil is down, CAD is up.

#122 Andrew on 04.18.16 at 2:54 pm

Excellent post.

Yes, it’s definitely a tough year this year in Alberta with oil sinking even lower.

If you want to invest in Canadian real estate this year it’s GTA all the way.

#123 For those about to flop... on 04.18.16 at 2:54 pm

#118 common sense on 04.18.16 at 2:21 pm
#108 Flopper

It’s Mike Puffy..not Duffy.

For further reference.

Thank you.

/////////////////////////////////

Puffy/Duffy I will let you decide Common ,but I still think HBO is going to get Danny DeVito to star as him in a movie…

M41BC

#124 IM in C on 04.18.16 at 3:09 pm

Housing prices will stay firm for another 10 years. Then the leading edge of the baby boom will turn 80. Even if they don’t die, they will discover they are no longer physically capable of remaining in their SFD. For the first time, a significant portion of home owners will -have- to sell. Until then, the real estate market, with some local exceptions , primarily in 1 industry towns; will continue on its merry way

#125 BOOM! on 04.18.16 at 3:10 pm

Your picture tonight is the most appropriate one this year (so far). Really captures the feeling of ‘main street’ here in the US. Most are tired of continuos ‘wars’ wasted tax dollars there, and an eco-system on self-destruct, similar to Smoking Man, except his eco-system affects only himself, and those that love him. We are all that way to an extent, we may as well admit it.
Nonetheless we should at least ‘try’ to improve our miserable lot in life. I think that is the desire of most.
In between times, we are denied those who would re-work a corrupt system. I did NOT say over-throw it, merely re-work it. Not a small desire, nor easy, but probably quite necessary.

#126 rainclouds on 04.18.16 at 3:17 pm

#110 Brazil “My point stands. They do NOT put politicians and bankers in jail in the USA or Canada.”

Apparently using Google isn’t your strong suit. This took 10 Seconds,

Canada: http://www.cbc.ca/news/politics/dean-del-mastro-sentenced-to-month-in-jail-4-months-house-arrest-for-election-overspending-1.3126992

USA: https://en.wikipedia.org/wiki/List_of_American_federal_politicians_convicted_of_crimes

Back to brazil: Apparently the penal system there isn’t too effective
http://www.visualcapitalist.com/violent-cities-world/

And Jailing Politicians THERE isn’t the age old solution you claim it to be:

From Bloomberg: “Until recently, no one could be sent to prison in Brazil until all possible appeals had been exhausted — an indulgence born of the laudable principle that the innocent must be afforded full protection. In reality, the rule practically ensured impunity by allowing powerful defendants with clever lawyers to barrage the courts with writs and infinite appeals. Last month, the Supreme Court closed that escape hole, deciding that anyone convicted of a crime in a lower court, and whose conviction was upheld on appeal, must go straight to jail.”

YOU are full of nonsense……………..

#127 For those about to flop... on 04.18.16 at 3:25 pm

Frank, and anyone sick of all the sales mix talk…

M41BC

https://imgur.com/Hr0wZk8

#128 Raincouver on 04.18.16 at 3:34 pm

DELETED

#129 Nemesis on 04.18.16 at 3:40 pm

#MondayMischief,Or… #ExpectationsManagement?…

[CBC] – City of Vancouver looks to buy homes and sell them at discount

“What I’m hoping is that they’ll understand what we’re trying to accomplish here.” – Vancouver City Councillor Raymond Louie

http://www.cbc.ca/news/canada/british-columbia/city-of-vancouver-affordable-home-ownership-pilot-program-1.3539688

[Independent] – People aged over 40 perform best with a three-day working week, study finds

“The research comes amid moves to edge the British state pension age closer to 70.”

http://www.independent.co.uk/news/uk/home-news/workers-over-40-perform-best-with-three-day-week-25-hours-melbourne-institute-study-a6988921.html

#130 Brazil ex-pat on 04.18.16 at 3:43 pm

#113 Samba Dancing on 04.18.16 at 1:24 pm
A tad short sighted….
http://www.xe.com/currencycharts/?from=BRL&to=USD&view=5Y
——-

#110 Brazil ex-pat on 04.18.16 at 12:55 pm

++++++++++++++++++++++++++++++++++++

You mean like this chart?

http://www.xe.com/currencycharts/?from=CAD&to=USD&view=5Y

#131 bdy sktrn on 04.18.16 at 3:51 pm

23 degrees at the beach today.

the new puppy got seasick on the boat yesterday (http://imgur.com/a/aCyQJ – warning : puppy pics)

each and every single last one of van’s sfh on a standard 33’lot is up 500k, minimum, since jan 2013.

double or triple that for the west side or bigger lots.

mark try less hard stuff and more mix, you appear drunk.

…..
flop don’t you have a job?

#132 jess on 04.18.16 at 4:13 pm

#78 WalMark of Sadkatoon on 04.17.16 at 10:36 pm

speaking of 1988 …look south at that time

How corporate executives and politicans looted the Savings and Loan Industry
http://wamc.org/post/wamc-s-alan-chartock-conversation-white-collar-criminologist-william-k-black#stream/0

#133 maxx on 04.18.16 at 4:14 pm

“Nobody would dare change the rules – like raise rates or hikes taxes – since average, hand-working folks would be slaughtered.”

Many at risk delusionals believe this.

On the other hand, the past 8 years have seen this sick meme supported by tptb, who have devolved into the same type of free-spending, immature fools who have already ruined themselves with debt or are in the pipeline of financial ruin but don’t yet know it….

Kinda reminds me of someone picking a zit, let’s call it the GFC fallout, hellishly determined to get rid of it, let’s call it “monetary accommodation” only to end up with a nasty, really ugly flesh wound that takes ages to heal and for years reminds them of the other path that was available…..

#134 maxx on 04.18.16 at 4:36 pm

#7 common sense on 04.17.16 at 6:38 pm

“What is this thing that is mentioned often on this blog about:

Raising rates?”

Def.: A long-forgotten, mythical concept of paying for money on deposit at a rate which actually confers value and perhaps more importantly, respect for it.
This concept has purposely been made obsolete so as to create a central bank tool to cause money to move ever and ever faster. The cheaper money can be acquired, the more people will borrow, causing increased unbridled spending, pricing pressure and disproportionate debt, among other types of economic malaise.
Fast forward a few years and decades and consumer proposal agencies proliferate, kids have to pass on some sports, the carousel of bill skipping starts to spin to the music of nightly arguments about finance and saving like a responsible member of society goes straight down the toilet.
It would appear that the cb has created and lobbed the hot potato of social safety net pressure (which will be hell on wheels given a ton of poor retirees) onto government tax coffers.

#135 common sense on 04.18.16 at 4:40 pm

#123 Flopper

Danny D? Too short but I like it.

How about one of Mike Myers characters from the Austin Powers series?

#136 Derek Ross on 04.18.16 at 4:44 pm

#61 Fed-up on 04.17.16 at 9:26 pm wrote:
Calgary, sales are down 8%, listings are also rising and the average price is 1.8% higher than a year ago. That’s less than inflation – and way less after you pay commission to sell.
————————————————————————————
Seriously, prices went up??? I don’t think the inflation thing and commissions mean much to anyone who is buying. Only that they have to pay almost 2% more than last year when prices should be collapsing.

It’s not as bad as all that. Don’t be misled by the averages! The average price paid for a house sold may have gone up but the average price received for a house for-sale went down. In fact some didn’t sell at all.

How is that possible? Well there are now more houses for-sale and fewer being sold because listings are up but sales are down. And sales are down because there are fewer buyers. In particular there are fewer low-price buyers because that is where the banks are most likely to get tougher on mortgage approvals. So on average the fewer buyers will have slightly higher mortgage approvals because they are better risks. So the average amount they want to pay will be higher: in the case mentioned, higher by 1.8%

Now each of those buyers who have been approved have roughly the same amount of mortgage money to use as they would have had before approval got tougher but because there fewer of them there is less competition and so they can afford to buy a nicer house for their money. This is good news for buyers but bad news for sellers because it means the buyers are paying the same but getting a better house than they would have whereas the sellers are selling the same house but getting less money than they would have. It is particularly bad for sellers with the worst houses in a particular price bracket who are finding that they have no buyer and are therefore getting no sale and no money. These sellers are the ones reducing their prices to try and become the best houses in the next lower price bracket rather than the worst in their current bracket. The sellers with the worst houses in the lowest price bracket have the biggest problem because they may have to move down to a price bracket lower than any approved buyer wants to spend. Those sellers will be unable to sell until the number of approved buyers starts to rise again or the number of listings starts to fall.

So the fact that “the average price is 1.8% higher than a year ago” is actually a result of the way that mortgage lenders approve mortgages. It has nothing to do with the prices being asked for individual houses which have been dropping (they would only collapse if the number of buyers collapsed too), as indicated by the difference between the number of houses being listed and the number of houses being sold.

#137 common sense on 04.18.16 at 4:45 pm

#116 CRA

Shocked you say? LOL.. Ever worked for the government before?

I did for the FED 2 years 30 years ago and never seen so many doing so little for so few yet expecting everything for nothing as if they were “entitled” to everything due to their exalted position above the masses…and yes YOUR paying for it…not me.

#138 Samba Dancing on 04.18.16 at 4:50 pm

Tank that ship baby… it better be nice there..

http://www.xe.com/currencycharts/?from=BRL&to=CAD&view=5Y

#130 Brazil ex-pat on 04.18.16 at 3:43 pm

#113 Samba Dancing on 04.18.16 at 1:24 pm
A tad short sighted….
http://www.xe.com/currencycharts/?from=BRL&to=USD&view=5Y
——-

#110 Brazil ex-pat on 04.18.16 at 12:55 pm

++++++++++++++++++++++++++++++++++++

You mean like this chart?

http://www.xe.com/currencycharts/?from=CAD&to=USD&view=5Y

#139 Give us this Blog our daily Garth on 04.18.16 at 4:51 pm

I noticed since the latest “no increase” announcement, rates are now back at 2015 “lowest ever” levels. And the party continues on the “desperate coast”.

You wait! The banks are going to put out their super low promo rates again. Pitt Meadows, Maple Ridge, Langley, and all the other areas are taking off. There’s going to be pushing and shoving… maybe it’s time to move to Winnipeg. They too have a state-of-the-art water treatment facility, and a hockey team that does no worse than the Canucks.

#140 For those about to flop... on 04.18.16 at 4:55 pm

#131 bdy sktrn on 04.18.16 at 3:51 pm
23 degrees at the beach today.

the new puppy got seasick on the boat yesterday (http://imgur.com/a/aCyQJ – warning : puppy pics)

each and every single last one of van’s sfh on a standard 33’lot is up 500k, minimum, since jan 2013.

double or triple that for the west side or bigger lots.

mark try less hard stuff and more mix, you appear drunk.

…..
flop don’t you have a job?

/////////////////////////////

I have two jobs today.
Job one…work on suntan.
Job two…hold Mark accountable for his comments.

Job two sucks but my suntan is looking good…

M41BC

#141 LP on 04.18.16 at 5:00 pm

#127 For those about to flop… on 04.18.16 at 3:25 pm
**********************

That sweet dog looks for all the world like a border collie? You realize it will be (a) smarter than you; (b) will last longer on the run than you; (c) in the absence of something larger will even try to herd your goldfish.

But hey, you’ll have more fun than should be allowed any one person and it will love you no matter what. How could anything be better than that?

Robin says “woof”.

F68ON

#142 Star Stuff on 04.18.16 at 5:40 pm

Bulldozer battles at construction sites!! Looks fun!

http://news.nationalpost.com/news/world/angry-chinese-construction-workers-duel-with-bulldozers

#143 waiting on the westcoast on 04.18.16 at 5:58 pm

#140 For those about to flop… on 04.18.16 at 4:55 pm says… “I have two jobs today.
Job one…work on suntan.
Job two…hold Mark accountable for his comments.
Job two sucks but my suntan is looking good…M41BC”

I don’t think job 2 pays enough… And accountability requires someone to acknowledge a mistake.

He is dogged in his theses though (even when the weight of the universe is proving him wrong).