To the mean

UGLY modified

“Pretty much everyone here is in denial that this could even happen,” says Scott. “So by the time the local media is reporting it, it’s already happening.” Truer words are hard to find, as millions will be learning over the next couple of years.

Scott lives in St. John’s, where house prices shocked the locals over the past half-decade by basically doubling. But that was then. It’s done now, and time to go down the other side. “A friend of mine bought a place in St. John’s last year for $319K (in the winter) and just sold for $265K (in the spring rutting season). Given that the NF oil economy is a one trick pony, that place is doomed.”

Of course, housing’s inevitable reversion to the mean ain’t just happening on the rock. It’s also taking place in Calgary, Edmonton, Lethbridge, Grande Prairie and Fort Mac. And all across Nova Scotia. This week the boss of the provincial realtors fessed up to this in a local interview: “I’ve sold houses for $100,000 less than their assessment.” And Roger Sanford suggests there’s a lot more coming, as the whole place turns into a giant’s buyer’s market. In some cases, properties have been selling for just 30% of their assessed values.

CREA says some Atlantic Canada house prices will fall about 8% this year, thanks to a crappy economy, volatile commodity prices, poor job prospects, loss of buyer confidence and a flood of supply overwhelming demand. In northern Alberta, prices have already declined by a quarter. Calgary and Saskatoon properties are losing value. Ottawa and Montreal are flat. Prices in Regina are almost exactly where they were a year ago.

Says RBC senior economist Robert Hogue: “The long-awaited cooling of Canada’s housing market may be finally at hand.” Which is compelling, since mortgages actually cost less now than a year ago. The five-year fixed has dropped down into the 2.4% (or less) – a number that is remarkable when the inflation rate is slightly less than 2%.

CREA reports home sales across the country (even including hopped-up Van and the GTA) declined 2.8% last month, and now says 2017 will bring a virtual flatlining of the national housing scene. Peak house, in other words, is probably behind us. “National sales activity and average prices reached new heights in the first half of 2016,” say the realtors, “amid a growing supply shortage of single-family homes in British Columbia and Ontario, particularly in B.C.’s Lower Mainland as well as in and around the Greater Toronto Area.”

PRICE CHART

Quite so. It’s not that the economy’s great (it ain’t), or wages are augmenting (they’re not), new jobs sprouting (ditto) or commodity prices recovering (down again), but rather a paucity of sellers that threw gas on the Lower Mainland and southern Ontario. It’s a phenom of hot markets and bubbly assets, wherein higher prices bring higher prices. Homeowners have recoiled from listing, fearing they won’t be able to buy if they sell. So demand created by cheap money and FOMO is chasing limited supply, squeezing valuations higher in a self-fulfilling prophesy.

This, in other words, is a market based on emotions, not fundamentals. That’s the difference between St. John’s, Halifax, Calgary, Saskatoon or Ottawa and you-know-where. It’s why our gasbag markets are increasingly at risk – since all it’ll take to pop them is a change in attitude, and a rapidly increasing number of listings. Plus a federal government desperate not to have a US-style real estate collapse take place on its selfie-infused watch.

As this morose but shapely blog has reminded you, there’s a lot to worry about. Brexit looks ugly, and is coming next week. The US race for prez is a joke. Commodities have stalled out, taking our dollar with them. The American juggernaut has slowed, at least for now. Household borrowing stays at nosebleed levels. The savings rate has collapsed while record numbers of people are retiring owing record amounts of money. The feds are adding about $120 billion to the national debt and 40% of young adults still live with their parents. How is any of this remotely positive?

The point is simple. What’s occurring in most housing markets across the country reflects economic reality. People who live there are acting in a way you’d expect. They’re being more cautious, paying less for shelter and lowering expectations. They’re not speculating, panic buying, prompting bidding wars or suffering from buy-now-or-buy-never. They’re shockingly normal.

Well, let’s finish off with a few comments from Linda, that personal banker/mortgage diva/[email protected] in Oakville (where people are also insane), who daily watches the tide of human emotion engulf her little green Main Street branch.

“I wanted to give you an update on how the real estate market is progressing into the summer now here in Oakville. Right now, the going rate for a five year fixed is 2.44. No more prime – .90 basis points on a variable means our clients who have mortgages at 1.85-2% are pissed that they have to renew at a higher rate.

“As you can imagine, some of the ones who also have “super-sized” their lending packages with Home Equity Lines of Credit are now paying 3.20 percent and .44 basis points more on hundreds of thousands of dollars. Anyway…that’s just one part of the story.

“A recent purchase and sale landed on my lap containing a $1.3 million purchase with a $930,000 sale. Clients are retirement age and don’t want a mortgage and I don’t blame them. They have saved all their lives no doubt and have $400,000 liquid in a savings account. They are able to a scrounge enough for closing costs which are around $60,000 from their TFSAs!

“So now there is an “investment” of a $1.3 million dollar house to look forward to during retirement. 3000 square feet for two people, no mortgage! I did try to sell them a home equity line of credit though, won’t lie!

“Anyway you can tell your readers why this is crazy and why you need an income to own a piece of property anywhere in this country and what happens when rates reset, etc. But if they won’t listen to their banker, I doubt they will listen to a former politician! Ha ha – we are like the same person. Take care Garth.”

At least the banker babe’s laughing. Sellers, too.

141 comments ↓

#1 bitcoin_fanatic on 06.16.16 at 6:35 pm

Made some money on bitcoin today. Now to figure out how to report it on my tax return. A good problem to have =]

#2 Serenity Now on 06.16.16 at 6:35 pm

Second?!

#3 next couple of years on 06.16.16 at 6:43 pm

Great statement
In the NEXT COUPLE OF YEARS.

And if next year does a stupid rise of 20%
and the year after again…

then the buy now mantra isn’t so bad, is it?

#4 common sense on 06.16.16 at 6:47 pm

I agree with the Garth that the USA will raise rates this year ONLY if Donald wins….and they will do it “just because.”

#5 Engel-Riviere Corp on 06.16.16 at 6:48 pm

BUY QUALITY COOKWARE AT VANCOUVER PRICES!

#6 Big English on 06.16.16 at 6:50 pm

A friend just bought an ‘investment’ condo in Whistler.
Another friend just Maxed out for a fixer upper in Lynn Valley.

Being the renter, I’m the one presently being laughed at.

#7 jay on 06.16.16 at 6:54 pm

Look at these Garth http://business.financialpost.com/personal-finance/mortgages-real-estate/stuck-in-the-middle-what-a-median-income-can-buy-you-in-vancouvers-hot-housing-market

#8 ILoveCharts on 06.16.16 at 7:00 pm

As the market cools, interest rates will need to drop.

#9 Andrew Woburn on 06.16.16 at 7:00 pm

#1 bitcoin_fanatic on 06.16.16 at 6:35 pm
Made some money on bitcoin today. Now to figure out how to report it on my tax return. A good problem to have =]
=====================

You could start with this:

http://www.canadiantaxlitigation.com/category/bitcoin-2

#10 Andrew Woburn on 06.16.16 at 7:03 pm

– America’s Dying Shopping Malls Have Billions in Debt Coming Due

“Green Street estimates that several hundred malls could shut down over the next decade, with properties reliant on Macy’s, JC Penney and Sears at the most risk. Sales at department stores, once the engines that powered shopping centers across the U.S., have declined almost 20 percent since 2006, according to the firm. About 800 department stores would need to shut down to restore balance between sales and profitability, Green Street said in an April report.”

http://www.bloomberg.com/news/articles/2016-06-16/day-of-reckoning-comes-for-u-s-shopping-malls-laden-with-debt

#11 RudyGQ on 06.16.16 at 7:04 pm

Wait a minute Garth,
Let’s be fair here. When house prices were rising at ridiculous rates and realtors were overselling the accolades of home ownership and proclaiming ‘record sales’, ‘inventory shortages’ with predictions of prices going to the moon in whatever local you may choose; you ridiculed their integrity and poo pooed their Frankenumbers.
In the same token it would not be prudent to quote the same realtor body when the market is in an apparent cooling off phase and use their statements as an indicator to support your position on mean reversion. For consistency, the realtor claims of slowing markets should also be discredited as well.

#12 Peppy Sue on 06.16.16 at 7:08 pm

We must all strive to remain shapely in our morosity…..hilarious, Garth :)

#13 White Crock BC on 06.16.16 at 7:09 pm

Smoking Man was right.

Oil in freefall.

Just off by 4 days.

How low will it go?

#14 Mark on 06.16.16 at 7:11 pm

Remember that Vancouver/Toronto prices and transactional volumes are inflated by assignment flipping and all sorts of other barely-arms-length schemas by some incredibly desperate people who are in a lot of trouble as it is commonly realized that house prices are falling nationwide.

Policy rates aren’t the problem. They’re going down as the economy continues to weaken worldwide, but especially in housing-bloated countries like Canada. The problem is that of overcapacity and debt exhaustion. Which is why risk premia is expanding as in Garth’s quotation of “Linda”.

#15 conan on 06.16.16 at 7:13 pm

People are born, they live and they die. Along the way, they buy things, sell things, and invest in their future.

About a decade ago I noticed something funny with the economy. A line of some kind had been drawn across our collective life-scape. On one side of the line was economic normality. On the other, it was adults living in their parents basement until whenever.

Whatever macroeconomic future awaits , I think it is safe to say that it is not going to be that prosperous. The economy could infact be a dud for a generation.

There are pockets of wealth and prosperity, but macro economically, it’s a collective dud. Does not help that there is debt everywhere. Lots of it in fact , and no real plan to pay it back.

#16 Market Man on 06.16.16 at 7:18 pm

In 2014 if you thought price would treat to 2011
Today you are praying that prices retreat to 2014

Raise your hand if you thought in 2014 rates would be cheaper are prices would be 30% higher.

#17 Smartalox on 06.16.16 at 7:19 pm

A Facebook friend of mine who happens to be a Realtor in Calgary posted a funny picture on FB today.

It depicted the famous ‘No Soup for You!’ guy from the Seinfeld show, but instead of describing soup, it said:

“No Pre-approval?”

“No Showings for You!”

I guess that the distance between Calgary sellers’ prices and Calgary buyers’ income is starting to grow, and a lot of offers conditional on financing are falling through.

First buyers stop buying – which means sellers stop selling.

Now begins that ‘sticky’ denial phase where sellers refuse to drop their prices, while the market crashes around them.

By the time they catch on, say at the end of the summer, the traditionally slow fall and winter markets will take another 10% to 15% of their equity.

#18 John Lamberton on 06.16.16 at 7:21 pm

Unfortunately lately, Garth, they won’t listen to their realtor either. I am amazed at how many times I’m asked for my professional opinion and 2 cents worth, the buyers and sellers do the opposite because everything on the Internet must be true.

#19 Tulips on 06.16.16 at 7:22 pm

REBGV is reporting May 2016 sales 17.6% higher than the same month last year, and listings 11.5% higher as well. I’m pretty sure I see far more RE signs in my hood than last year, but unlike last year they now happen to have a sold sticker on them days after going up. Have homeowners really recoiled from listing? That would be a somewhat rational explanation if volumes were down, but I don’t see it. I think this bubble is made of FOMO on a such a grand scale that it is pushing people to frantically trade with each other at higher and higher volumes, prices, and debts.

#20 Market Man on 06.16.16 at 7:22 pm

Next couple years??

The fact is no one knows what the future will hold
We didn’t know last years prices would rise 15% and next they may drop 15%

If speculators are driving the market and prices drop or become stagnant they will leave

But it certainly does seem we are always two away from “something happening”

Unemployment will be the driver

#21 Brian Ripley on 06.16.16 at 7:23 pm

re: “Household borrowing stays at nosebleed levels. The savings rate has collapsed while record numbers of people are retiring owing record amounts of money.” Garth

Today I posted a chart mashup of comparison between Canada and the U.S. with respect to the Savings Rate, Retail Sales and Household Ownership.

It looks to me that we “imported” this housing boom. Too bad we can’t export the bust.

#22 Brian Ripley on 06.16.16 at 7:24 pm

I forgot to add the link of the chart mashup:

http://www.chpc.biz/history-readings/made-in-america

Canada and the U.S. Savings Rate, Retail Sales and Household Ownership.

#23 Scumop on 06.16.16 at 7:28 pm

Anyone who wants to bail on their house or condo should be encouraging their governments to run sales junkets to Asia full of real estate agents and flog, flog, flog.

If indeed its true there are people trying to get money out of China, its important to target them. Too many appear to be taking that money elsewhere.

Some people claim the money exit from China is seen as a problem, perhaps even illegal, by the Chinese government.

Not our problem. Not even a little bit.

The money they bring to Canada is all good and we have no laws against it. Only a Canadian fool would object to legal cash being shovelled into Canadian pockets.

Since the preference amongst the money bringers is for high end property, it has no impact in prices in the range most locals can afford. And now we see the locals are rapidly losing interest anyway, so even less need to care. At least until those offshore sources of money realize the party is ending and take their money elsewhere.

The anti-Asian thing is mere sentiment, racist variety. Consider the logic of someone offering you a million $, no strings attached, which is the case. You say “I can’t take that million because you are Asian.”

I say if someone is stupid enough to give you free money, you would be stupid not to take it.

Some people can make excuses and tell ‘just so’ stories, but the reality is the foreign buyers are not a problem, and maybe their purchases soften the landing for at least a few people who got sucked into the buy high property gold rush.

#24 valleyrenter on 06.16.16 at 7:32 pm

Friend is selling their typical B.C. box in Langley, moving up province for a career opportunity. Had an open house last weekend, aaaaaaaaaand… Nada. Having more open houses coming up. Hmmmmmm…

#25 Dog Lover on 06.16.16 at 7:33 pm

Garth, you aren’t touching on the real issues in Canada. The High courts and our government are having a time of it with animals, songs (O Canada ” not sons but us”) and lets not forget leaving other the last government in GOOGLE
The housing crisis is just a fiction made up by blogs like this one, other reason why you never make Headlines. Get out of your own Bubble and follow the beautiful wave of our dearly beloved selfie PM and his gang.

http://www.breitbart.com/big-government/2016/06/09/canada-supreme-court-legalized-humans-sex-animals/

http://news.nationalpost.com/news/canada/canadian-politics/federal-liberals-have-asked-google-to-delete-dozens-of-harper-era-web-pages-from-its-search-results

#26 Jimmy on 06.16.16 at 7:34 pm

Nice Selfie !

#27 For those about to flop... on 06.16.16 at 7:36 pm

Brexit/Euro2016 update.

Well today was a good day for Stexit or the stay side of the Brexit vote.

Floppers England managed to overcome AceGoodhearts stubborn real estate dragon Wales scoring the winner in injury time.

This result was enough to put England top of the group and bookmakers Ladbrokes eased the percentages a couple more into the stay camp.

In the second game Jimmy did not get his wish to be first as Poland and Common sense’s Germany drew,both teams are in a good position to go through to the knockout stage.

It’s only a matter of hours before OLC starts sending me hate mail as he was switched at the last minute to Ukraine and they are all but eliminated.

Gut Check and her feisty Northern Ireland are still a big chance to go through as are Wales for that matter so no Brexit team has been confirmed or mathematically eliminated as yet.

They all play one more game before the referendum takes place and this tournament gets to the win or go home stage.

Overall a good day for the stay camp…

M41BC

#28 Market Man on 06.16.16 at 7:37 pm

If they want to slow the Market without hurting the other slowing markets raise down payments to 30%
And amor to 25 years
It’s simple !
They were not serious with the last round of mortgage rules that’s what’s makes me wonder what they really want

#29 Market Man on 06.16.16 at 7:38 pm

Sorry forgot to add 30% down payment for home homes that sell over one million

#30 Freedom First on 06.16.16 at 7:40 pm

Yes. I was saying that about the media on this Blog since the Fall of 2014 with my Alberta updates. The ones where people on this Blog called me a liar because if it was true, they would have already heard about it.

Now is always a good time to be liquid, have ca$h, ca$h flow, a$$ets, and zero debt. I learned this when I was a teenager. I’ve been blessed.

Look after myself, and help others. Gives a good life.

The better I look after me, the more able I am to help others.

Garth is helping many many many people, in spite of facing the wrath of the greedy, the fearful, the ignorant, and the people with their own agendas, many of whom are unethical. And Garth is not afraid to name the unethical either.

For the ones who wish to insult my comment, as per usual, feel free, as I understand. The truth is very painful for the majority of people. Fact.

#31 WalMark of Sadkatoon on 06.16.16 at 7:41 pm

damn made a mistake below

2.5 yrs later and the market cap is only $23b and the enterprise value is $31b!

even worse than I thought!

gold prices have destroyed them!

what a dud!

This is my favourite quote from Jan 2014:

“new projects are costing 3-5X as much to build as they did a decade ago (largely because energy costs have gone up 3-5X, especially crude oil!). Effectively this should cause the value of existing projects to appreciate. Barrick, for instance, will probably end up spending $10B to get Pascua-Lama in production, to produce a mere 800k ounces/year in gold. Barrick’s production overall is roughly 8M ounces/year. So should Barrick’s enterprise value (equity + debt) not be approaching $100B? Instead of what, ~$25-$30B today? The firm is trading at dramatically less than the replacement cost of its assets. Remember the wise Warren Buffet who said that he wants to buy companies at dimes and nickels on the dollar — that’s what you’re doing when you buy many of the gold miners these days whose assets have not appreciated to reflect the reality of replacement cost appreciation”

2.5 years later and I think we’re at $32B market cap

almost approaching $100B!

lol

#32 WalMark of Sadkatoon on 06.16.16 at 7:45 pm

I have no idea why YVR and YYZ real estate prices continue to rise …

wait actually I do know why

cheap credit

doomed

#33 Dear John on 06.16.16 at 7:45 pm

#18 John Lamberton on 06.16.16 at 7:21 pm

John Darling, I hate to tell you like this but the reason we do the opposite is because most of us have been mistreated one too many times by your “profession”.

#itsnotmeitsyou

Sorry, Love always,
Cash Buyer

#34 WUL on 06.16.16 at 7:45 pm

Garth:

A minor point. It is “Grande” Prairie not Grand. There are a few Francophone communities over there. The last thing you need are a bunch of John Deere salesmen moonlighting as realtors hunting you down.

Signed,

Range Of The Buffalo 4H Club Spelling Bee Champion 1973 – 1977

#35 Smartalox on 06.16.16 at 7:49 pm

I guess that’s why they call it the ‘mean’: it cuts deep, and spares no one!

#36 jay on 06.16.16 at 7:54 pm

Lot’s of rental’s available in Van. http://www.priceypads.com/alternative-living-7-closets-you-can-rent-in-vancouver-b-c-from-480month-photos/

#37 Andrew Woburn on 06.16.16 at 8:17 pm

#15 conan on 06.16.16 at 7:13 pm

Whatever macroeconomic future awaits , I think it is safe to say that it is not going to be that prosperous. The economy could in fact be a dud for a generation.
=================================

You may be an optimist. A key component of high net profits has always been assymetric information, knowledge entrepreneurs have acquired which others don’t share or can only access with difficulty. A simple example would be a pre-internet travel agent who once could earn a decent living reselling pre-packaged information to the public.

The internet is steadily eroding this information gap in almost every field and so reducing the margin which can be earned from it. The internet is also grinding away at any barriers between regional markets and making competition global for anything tradeable between regions.

Another key component is property rights but as technologies proliferate and overlap, defending IP gets more expensive. Automated machinery and processes drop costs but also become more widely available to potential competitors.

It seems to me that the net profit ratios we came to expect in the 20th century are now history and the trend is down.

#38 Van Isle Renter on 06.16.16 at 8:22 pm

Out here in the Comox Valley the word is that the market is being snapped up by people bailing out of Vancouver and Victoria. This “take the money and run oowah, oowah” behavior is indicative of an overheated market topping out and rolling over.

Savvy homeowners in the twin flowers see the writing on the wall and know that the V&V markets are starting to unwind. When the first time buyers and the retiring boomers both throw in their towels it’s all over.

No different than Nortel, Bre-X or Enron. Only difference is that the collapse will be slower and impact the whole country. It’s waaaayyyyy too late for T2 to do anything. Harper had a chance to halt this mess but blew it when he kicked out the hirsuited host of this reprobatical blog.

It will be clear for all to see by Christmas.

#39 JMS on 06.16.16 at 8:24 pm

Does anybody care to offer a rational reason why ZPR plopped by 1.8% today? There were no interest rate moves or signals coming from the BOC, and it couldn’t have been a reaction to the Americans holding (which everybody expected). Or is just sometimes the market does strange things?

M42MB

#40 Doug t on 06.16.16 at 8:26 pm

Capitalism as it has existed for the last 200 years has run its course. More people are in poverty – more people have little to hope for in their future – the rich have taken too much from so many for so long that there is little left to take. Wall Street is manipulated by the top corporations – this is a fact. We have been entering an era of stagnation for the last 25 years and it will get worse. And what does history tell us when societies become weighed down with social unrest, lack of hope, financial ruin = war – it has always been the go to plan.

#41 Linda on 06.16.16 at 8:32 pm

This morning listened to an interview on the radio – realtor who is claiming he is getting ‘an increasing number’ of inquiries regarding Calgary ‘luxury’ real estate from – you guessed it – Asians looking to purchase. HAM has officially arrived in Cowtown! Meanwhile, a rep of the local RE board mentioned that prices overall have declined by a modest 1%, mainly due to ‘increased interest & offers in the luxury housing market in Calgary’. Well, if the ruse worked in Vancouver I guess it could work here….. The guy being interviewed said that HAM is interested in Calgary as the prices are a real bargain compared to Vancouver or Toronto. Also mentioned that Calgary has a lot of amenities that buyers are looking for when purchasing RE. To be fair, the guy being interviewed did NOT say HAM was flooding the market, more like HAM was kicking the tires & ‘a few’ sales were in progress.

#42 charles on 06.16.16 at 8:37 pm

The flip side of return to the mean is when prices have been depressed they should rise. See Windsor On. where after decades of sub $200K price levels for even nice waterfront properties 2016 has seen an 13% rise in prices this year and multiple bids are now normal!
http://www.cbc.ca/news/canada/windsor/windsor-housing-boom-buyers-1.3638527

6/16/16
A blog dog called it last night.

The West Yorkshire Police reports that Jo Cox has died as a result of her injuries. The police also adds that a full probe is under way to establish motive. It remains to be seen if the Brexit referendum vote will be delayed as a result of this death.
-ZH

“The illusion of freedom will continue as long as it’s profitable to continue the illusion. At the point where the illusion becomes too expensive to maintain, they will just take down the scenery, they will pull back the curtains, they will move the tables and chairs out of the way and you will see the brick wall at the back of the theater.”
― Frank Zappa

#43 For those about to flop... on 06.16.16 at 8:43 pm

For the record,I wrote today’s post before finding out some nut job had killed a politician campaigning for the stay side and the campaign had been suspended.

I wonder if they will put the date back?

Why do things that are supposed to bring us together tear us apart…

M41BC

#44 Aggregator on 06.16.16 at 8:51 pm

Unemployment will be the driver

Unemployment is a sympton, not a cause of economic downturns. What would drive interest rates higher is when China and/or emerging markets recover (forget Europe) and all that institutional money that fled into safe haven bonds (US and Canada) starts to flee. That's when interest rates start to shoot up.

But I'll bet we'll see the CAD 5YR bond near 0% or below before then.

#45 common sense on 06.16.16 at 8:53 pm

#27 Flopper

Thanks for the update. I have to agree with you as odd as it sounds as England goes so may the Clash “Should I stay or should I go” Vote.

Hey Freedom First; Whatever you think the truth is, it is from your perspective 100% always.

#46 For those about to flop... on 06.16.16 at 9:01 pm

#39 JMS on 06.16.16 at 8:24 pm
Does anybody care to offer a rational reason why ZPR plopped by 1.8% today? There were no interest rate moves or signals coming from the BOC, and it couldn’t have been a reaction to the Americans holding (which everybody expected). Or is just sometimes the market does strange things?

M42MB

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

Three things, JMS.

1)Thanks for the gap code support.

2) I’m glad someone from Manitoba is on the blog to break up the B.C / O.N monopoly.

3)No clue what’s going on with ZPR but my Euro fund with all the drama over there at the moment 1.8 ain’t so bad.I have an Indian fund that’s even more volatile regularly up and down in the 2s but I hold on and cover my eyes…

M41BC

#47 gut check on 06.16.16 at 9:14 pm

Soooo…

guess what we did yesterday?

We bought a house…. AND…
.
.
.
.
.
a KIA!

not kidding. :)

#48 Look Out Below? on 06.16.16 at 9:16 pm

“Reversion to the mean?”

Not in TO or Van City. Massive immigration, super cheap rates (forever?), CMHC backing, govt. incentives, etc. guarantee that housing is safe.

#49 No Ham in Cowtown, Yet...?!? on 06.16.16 at 9:18 pm

#41 Linda on 06.16.16 at 8:32 pm

I heard that realtor sad attempt to to incite some Vancouver style mania which didn’t sound very believable at all…..this segment seems to be a more balanced/believable viewpoint on new immigrants arriving in calgary (from china).
Cheers!

http://www.cbc.ca/news/canada/calgary/foreign-real-estate-calgary-vancouver-1.3639268

#50 cat lover on 06.16.16 at 9:18 pm

I {heart} Linda [email protected]!

Seriously, it’s fascinating to get a glimpse of her perspective from the front lines of retail banking. Many thanks to you Garth as always, and to Linda for sharing.

#51 For those about to flop... on 06.16.16 at 9:35 pm

#45 common sense on 06.16.16 at 8:53 pm
#27 Flopper

Thanks for the update. I have to agree with you as odd as it sounds as England goes so may the Clash “Should I stay or should I go” Vote.

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

Hey Common,I have tried to communicate why this tournament is affecting the Brexit vote ,I have touched on a few points and now I will give up a few more.

Football is part of England’s social fabric they should be thinking about financial and humanitarian reasons amongst other things but we live in a ” 5 minute society” where everyone is only worried about what is going to affect them in the next five minutes.

There is bad blood between the ruling government of European football.There is massive corruption and England have made bids to host tournaments and lost only to find out later on that the process was rigged.

It has been discussed in parliament and even the royal family is involved to some degree as Prince William is the president of the English Football Association who runs the national team and develops the game right down to grassroots level.

There is a good chance England stays in the EU and in this tournament past June 23rd and then England will lose and a heap of people will want another vote.

Soccer should not be a factor in Stexit/Lexit….but it is…

M41BC

#52 For those about to flop... on 06.16.16 at 9:39 pm

#47 gut check on 06.16.16 at 9:14 pm
Soooo…

guess what we did yesterday?

We bought a house…. AND…
.
.
.
.
.
a KIA!

not kidding. :)

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

Wow! You are a hardcore Northern Ireland supporter.

Your team gets a win and you lose your mind…

M41BC

#53 John on 06.16.16 at 9:41 pm

Hi Garth,

In US it’s possible to have a self-directed IRA owning a LLC which can invest in anything.
Is anything similar possible in Canada?

Thank you,
John

#54 gut check on 06.16.16 at 9:47 pm

@ #52 For those about to flop… on 06.16.16 at 9:39 pm

:D I can only hope I find it again.

#55 Trickle down economics on 06.16.16 at 9:48 pm

How do you like me now?

https://youtu.be/sVzvRsl4rEM

#56 WalMark of Sadkatoon on 06.16.16 at 9:51 pm

Second?!

congrats

#57 WalMark of Sadkatoon on 06.16.16 at 9:52 pm

NS is a weird one. some places have been decimated and then there are shoebox condos overlooking the water for $600k

#58 For those about to flop... on 06.16.16 at 10:00 pm

#54 gut check on 06.16.16 at 9:47 pm
@ #52 For those about to flop… on 06.16.16 at 9:39 pm

:D I can only hope I find it again.

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

Hey Gutie ,I like your attitude.

You have been here for a while and I’m sure you studied both sides of the coin and made the right decision.

Did you spend so much money on the house you had to settle for the Kia?: )

Yesterday was a big day in your life …congratulations…

M41BC

#59 Smoking Man on 06.16.16 at 10:03 pm

Gartho your not the only one that gets emails.

From a fellow tin foilers.
http://www.globalresearch.ca/father-of-orlando-shooter-is-long-time-cia-asset/5531068

That asside. Sitting under the gazebo in Shlong Baranch having a few with son number 1.

Top salesmen four months in a row fortune 500 company tells me I wish I had this app. It would increase my sales 2 fold. Can you code it dad.

45 minutes later a proto type app is born. Such a brilliant idea. Why didn’t I think of it myself.

A new business is born while tripping over spent beer caps and cigarette buts.

Entrapuners is all I’m saying.

#60 Vanreal on 06.16.16 at 10:05 pm

Not sure there’s any comparison between the loser markets you mention above and the two cities of Vancouver and Toronto. Young people and immigrants want to live in Canada’s only two cities worth living in. They are generating the jobs and the excitement and the quality of life.

#61 common sense on 06.16.16 at 10:09 pm

#51 Flop

Seriously, your points make perfect sense.

Go Germany!

#62 Kona on 06.16.16 at 10:09 pm

My best friend in St. John’s listed her home in Jan. Bought it brand new 5 years ago for $369K. Listed for $489K. No calls. No showings. Still on the market and now is listed for $449K. No calls. No showings. Lots of competition in her neighbourhood and none of those are selling either.

Personally, I think she needs to list with a 3 at the beginning of the price. She is not ready to hear that yet. You know you are in trouble when no one will even come and take a look at the home.

#63 Smoking Man on 06.16.16 at 10:11 pm

#50 cat lover on 06.16.16 at 9:18 pm
I {heart} Linda [email protected]!

Seriously, it’s fascinating to get a glimpse of her perspective from the front lines of retail banking. Many thanks to you Garth as always, and to Linda for sharing.
……
I’m not messing with you. Every serial killer amd mal content has been a cat lover.

Dog lovers, only ones I hang with.

#64 S.Bby on 06.16.16 at 10:18 pm

My elderly neighbours house is sold. Took one week. Don’t yet know for how much but it was listed for 1.628 million.

#65 toronto1 on 06.16.16 at 10:21 pm

the smart money has so far cashed out nicely in the GTA, what the coming months will bring will be the sideline folks who are looking to profit– sellers, i expect inventory to rise while at the same times sales to lag as well. there may be a good 3-4weeks left in the GTA market before the “bidding wars” stop and it slows to a trickle by Nov.

#66 Ex-Cowtown on 06.16.16 at 10:31 pm

60 Vanreal on 06.16.16 at 10:05 pm

Not sure there’s any comparison between the loser markets you mention above and the two cities of Vancouver and Toronto. Young people and immigrants want to live in Canada’s only two cities worth living in. They are generating the jobs and the excitement and the quality of life.

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

Absolutely. That is why my two millenial nieces left Van and moved back to Calgary. Rent was too cheap and their jobs paid too well. They could not handle having such a bright future.

#67 Smoking Man on 06.16.16 at 10:32 pm

Eunyrepunorship or something like that. Finding a gap and filling it has huge rewards.

It’s how a Smoking Man rolls.

Solving problems is where it’s at. You should have paid more attention to Lego bricks and batman hot wheels as kids.

Now go out and search for that acceptance pat on the head? your teacher taught goal. Now go and fetch dog , get some left overs from assholes like me.

I have so much work to do with humanity..

With no stupid slaves around I would have to work..guess I really should be thanking teachers.

Smokey Man
PhD Herdonomics.

#68 Smoking Man on 06.16.16 at 10:46 pm

Problem with me at sort of the later stages of life I’ve discovered honesty. 57 is ok. I’ve lived. Cigarettes and bozze from here on in.

Me vs god. He’s frightend to debate me. Hence I got some power too.

Just like every retired climate change scentist who dosent require conformity for his income. And tells lt like it is.

#69 Do you believe these guys? on 06.16.16 at 10:50 pm

I get a feeling that your sources Garth, are trying to protect their business by downplaying the bubble ” Robert Hogue:“The long-awaited cooling of Canada’s housing market may be finally at hand.” ”

Are they afraid of the Finance Minister’s and BOC’s coming measures ? Are they attempting to steer away these much needed measure ?

#70 DON on 06.16.16 at 11:00 pm

#3 next couple of years on 06.16.16 at 6:43 pm

Great statement
In the NEXT COUPLE OF YEARS.

And if next year does a stupid rise of 20%
and the year after again…
************************

Yikes….so sooner or later you will need to be a billionaire to buy a house. As the pendulum falls backwards from it’s swinging height. Welcome to Earth!
then the buy now mantra isn’t so bad, is it?

#71 Smoking Man on 06.16.16 at 11:04 pm

Now son number 2 it was a while a go when he sent me a text about to jump off a bridge . Oxy addict who i cut off funding for at the time. I tricked him into thinking let’s have last beer together.

He agreed . Cops zeroed in on his location
Ambulance showed up.

After the 12 steps and a stint at trios collage he’s helping others.

PROUD OF HIM.

His pro hockey trainer got him hooked. Get back on the ice.

It can happen to any of your kids. Lean solve problems dogs.

Son number 3 a smarter version of me. . Let him write his own story…

#72 WUL on 06.16.16 at 11:15 pm

Dr. Smokes:

The article you linked at #59 is a spellbinder and a potboiler and a bodice ripper.

Well done.

#73 Ontario's Left Coast on 06.16.16 at 11:16 pm

#27 Flopper

Ukraine, eh? No worries, I’ll try anything once… Have no fear of hate mail, buddy, it’s all good!

Also CPD took a fair hit today but some of my REITs recovered a bit… Strange days indeed. Cheers and good luck to all!

#74 BOOM! on 06.16.16 at 11:24 pm

Yes, well it’s Thursday in the cow pasture. Had a good long discussion with friends tonight about the stupid stuff people do. Along with a few adult beverages…

Glad I lightened up the portfolio last Thursday. Besides today, it’s been downhill since. Tomorrow is a new day at the casino!

Stuffed the checkbook a bit, got dry powder, looking for a “yes” we leave vote, from our brethren the Brits, who may well take their future into their own hands. Good, they might just show us lazy Americans that what you EARN dictates where you stand – NOT what you can borrow from others, while your base earnings erode.

I found the professional’s advice to be widely ‘diversified’ is a bunch of crap. It is WHO has the best mouse trap, or cat, determines who finishes on top.

Only those free to determine their own country’s future have a chance, if they’re educated, and willing to compete!

Dry powder well deployed is my idea. Great companies that pay good dividends while paying attention to business seems to work quite well.

No, thanks, but I’ll chart my own course here. I will eat my own cooking, and have only one to blame should I fail here. I’m in no hurry to turn on the heat…yet.

Real Estate is only good if you can PAY for it, or find a greater fool who will.

M64WI

#75 Smoking Man on 06.16.16 at 11:27 pm

Writers blog is an excuse for laziness.

Sorry Smoking Man fans, the book is coming. I need a trigger of some kind. Poverty is my bet, write the book its your only hope.

Well apart from faking it for the above reasons (Son2) that is not going to happen soon.

60 book sales vs, Forex…..you know where my priorities lie.

Tax farm shit too. But that is only because my rivals have sanctioned “Dr”before their names and I need to show em what a real DR looks like.

Being a shit disturber is so under rated fun.

#76 BillyBob on 06.16.16 at 11:28 pm

#11 RudyGQ on 06.16.16 at 7:04 pm
Wait a minute Garth,
Let’s be fair here. When house prices were rising at ridiculous rates and realtors were overselling the accolades of home ownership and proclaiming ‘record sales’, ‘inventory shortages’ with predictions of prices going to the moon in whatever local you may choose; you ridiculed their integrity and poo pooed their Frankenumbers.
In the same token it would not be prudent to quote the same realtor body when the market is in an apparent cooling off phase and use their statements as an indicator to support your position on mean reversion. For consistency, the realtor claims of slowing markets should also be discredited as well.

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

Logic check.

If you’re trying to judge the veracity of someone’s statements, it helps to consider the motivation. Realtors are highly motivated to promote rising markets, not falling ones. Their incentive to manipulate statistics to the positive is obvious. So if they are actually admitting that things may be reversing there is nowhere near the same reasons to doubt them.

Your premise is nearly as dumb as linking Brexit to the results of football matches. THAT one is more like reading tea leaves or chicken bones, though – more silly than illogical.

#77 BG on 06.16.16 at 11:35 pm

#1 bitcoin_fanatic on 06.16.16 at 6:35 pm
Made some money on bitcoin today. Now to figure out how to report it on my tax return. A good problem to have =]
—————————————————————

Congrats.

You should look at Ethereum too.
Price is going nuts. From 13 to 21 USD in the last few days

#78 DON on 06.16.16 at 11:36 pm

#17 Smartalox on 06.16.16 at 7:19 pm

A Facebook friend of mine who happens to be a Realtor in Calgary posted a funny picture on FB today.

It depicted the famous ‘No Soup for You!’ guy from the Seinfeld show, but instead of describing soup, it said:

“No Pre-approval?”

“No Showings for You!”

I guess that the distance between Calgary sellers’ prices and Calgary buyers’ income is starting to grow, and a lot of offers conditional on financing are falling through.

First buyers stop buying – which means sellers stop selling.

Now begins that ‘sticky’ denial phase where sellers refuse to drop their prices, while the market crashes around them.

By the time they catch on, say at the end of the summer, the traditionally slow fall and winter markets will take another 10% to 15% of their equity.
*****************************

Nicely put!

#79 Vanreal on 06.16.16 at 11:45 pm

60 Vanreal on 06.16.16 at 10:05 pm

Not sure there’s any comparison between the loser markets you mention above and the two cities of Vancouver and Toronto. Young people and immigrants want to live in Canada’s only two cities worth living in. They are generating the jobs and the excitement and the quality of life.

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

Absolutely. That is why my two millenial nieces left Van and moved back to Calgary. Rent was too cheap and their jobs paid too well. They could not handle having such a bright future.

Once they taste unemployment they’ll be back!

#80 DON on 06.16.16 at 11:46 pm

#30 Freedom First on 06.16.16 at 7:40 pm

Yes. I was saying that about the media on this Blog since the Fall of 2014 with my Alberta updates. The ones where people on this Blog called me a liar because if it was true, they would have already heard about it.

Now is always a good time to be liquid, have ca$h, ca$h flow, a$$ets, and zero debt. I learned this when I was a teenager. I’ve been blessed.

Look after myself, and help others. Gives a good life.

The better I look after me, the more able I am to help others.

Garth is helping many many many people, in spite of facing the wrath of the greedy, the fearful, the ignorant, and the people with their own agendas, many of whom are unethical. And Garth is not afraid to name the unethical either.

For the ones who wish to insult my comment, as per usual, feel free, as I understand. The truth is very painful for the majority of people. Fact
***********************************

I remember what you were saying – always made me wonder what line of work you were in – as you said you were always trying to help folks, debt consolidation??

You were right!

#81 no longer smoking man on 06.17.16 at 12:19 am

I would love to buy a “reverted to the mean” house in Lethbridge, please show me one.

#82 Joe2.0 on 06.17.16 at 12:27 am

Cash out.
Buy back in a cheaper market.
Retire earlier.
No brainer.

#83 SWL1976 on 06.17.16 at 12:54 am

Just going thru my PVR and found myself watch another doc: this time on wind power in Southern Ontario. These poor farmers don’t really understand what exactly is going on and still have trust in a system that is set up to crush all their hopes and dreams.

Green energy and wind power in Southern Ontario is a blatant form of Agenda 21 in action. Get the people off the land. Can’t have farmers growing food and supporting local communities. It’s all so obvious once you lift the vail and look at the bigger picture

cor·po·ra·toc·ra·cy / kôrpərəˈtäkrəsē/ noun / a society or system that is governed or controlled by corporations.

No point standing in front of a steam roller. Prepare accordingly. Government’s are owned and they have now sold us off to not even the highest bidder. And like the mountains of debt circulating the world that can never ever, ever, ever, ever, ever, never, ever ever be repaid…

Reality is one ugly beast these days

Ignorance is bliss, but it’s still ignorant

#84 Spaccone on 06.17.16 at 1:03 am

3,000 sq ft at retirement age – the Canuckian dream.
Houses that size own you, you don’t own them. Say goodbye to a ton of valuable time stolen from an unending cycle of maintenance, repair, and renovation.

#85 Look Out Below? on 06.17.16 at 2:14 am

“When rates reset.” – Linda

————————————————-

What absolute nonsense. Will never happen.

#86 cat lover on 06.17.16 at 2:23 am

#63 Smoking Man on 06.16.16 at 10:11 pm
I’m not messing with you. Every serial killer amd mal content has been a cat lover.
Dog lovers, only ones I hang with.
——–

Oh my. I did not see that coming. Guess I should point out that I love dogs too…

#87 K.I.S.S. on 06.17.16 at 3:24 am

YVR/416 not selling as mortgaged to the hilt and a new place will cost much more. Affordability and debt payment.

Economy slowing down and/or negative as are jobs creation…no one buys in such an economic environment.

And #16 Market Man, put your hands up if in 2014 there was a negative GDP and Jobs creation economy and a 2nd Q forecast of negative GDP.

It has always been about the economy and jobs.

Negative emotion only exacerbates a recession (as in, first person out the door that sells for any profit wins).

Why RE in YVR/416 will crash and not soft land.

#88 3s on 06.17.16 at 4:22 am

All bankers and pollies should be laughing. Financial repression is working exactly the way it was designed and planned by transferring wealth from Savers to Borrowers, who then allocate the easy money into all sort of unproductive ‘investment’ (AKA property). And there you have your bubbles, as planned.

#89 Boomer Death Counter on 06.17.16 at 7:13 am

Bowie, meet Meat Loaf.

https://www.theguardian.com/music/2016/jun/17/meat-loaf-collapses-on-stage-in-edmonton-during-canada-tour

The tide of boomers who are falling ill and dying is becoming a tsunami.

Boomer political influence is already toast. Most will be dead by 2024, or so ill to be of no economic or political consequence.

Big change is here. The smart, young money knows it.

The average Boomer is in his/her fifties. The only dead thing in 2024 might be your weed-addled cranium. — Garth

#90 Noel on 06.17.16 at 8:02 am

…40% of young adults still live with their parents. How is any of this remotely positive?
____________________

How is this a bad thing? Its also largely a cultural thing. I know you don’t respect other people’s opinions, but I figured you would respect a frugal lifestyle and longstanding cultural traditions of intergenerational living.

Frugality does not fuel the economy nor create jobs. — Garth

#91 fancy_pants on 06.17.16 at 8:06 am

good luck won’t help anymore. we are near the end of the line. we can’t continue to sell things to each other on credit and call that productivity. when things go sideways they will do so quickly. buckle up. it’s going to be a bumpy year coming

#92 Unhinged Loon on 06.17.16 at 8:09 am

The Bitcoin pump and dump is at it again…

#93 maxx on 06.17.16 at 8:11 am

#11 RudyGQ on 06.16.16 at 7:04 pm

“Wait a minute Garth,”………

…….” In the same token it would not be prudent to quote the same realtor body when the market is in an apparent cooling off phase and use their statements as an indicator to support your position on mean reversion. For consistency, the realtor claims of slowing markets should also be discredited as well.”

Depends on your perspective. Realtards raison d’être is to talk up the markets ad infinitum whilst running numbers to support this. Realtards are now changing their tune and it means (to me) that things are probably a he!! of a lot worse and it’s a trend.

Prices are melting in our area – by a lot. In fact, by the amounts Garth is quoting today. Every day I receive emails with price drops, repeat price drops and still, buyers aren’t biting. Stuff stays on the market for years.

Two Canadian markets have gone completely insane and the rest are leading the charge to a relentless melt.

Buy now or buy never? Nah.
Buy now and wealth severs.

#94 Herb on 06.17.16 at 8:26 am

http://www.cbc.ca/news/business/canada-offshore-tax-avoidance-corporations-tiea-1.3639597

Someone please tell me how this is all for the greater good, how it will improve the economy, and how these profits will trickle down to us.

Or, perhaps better, how I incorporate myself as an investment group, rent a branch plant/drop box in Barbados, open a bank account there, and enjoy the profits of my labour at a 2.5% tax rate.

Yep, cor·po·ra·toc·ra·cy, as defined at SWL1976’s #83, but surely not in Canada! Right?

#95 Willdaman on 06.17.16 at 8:27 am

Bullard of Fed St.Louis says only one rate hike needed through 2018.
http://www.cnbc.com/2016/06/17/feds-bullard-only-one-rate-hike-needed-through-2018.html

So the hike last December wasn’t “one and done”, looks like it will be “two and done” if this particular Fed insider has his way.

#96 maxx on 06.17.16 at 8:37 am

#17 Smartalox on 06.16.16 at 7:19 pm

“……and a lot of offers conditional on financing are falling through.

First buyers stop buying – which means sellers stop selling.

Now begins that ‘sticky’ denial phase where sellers refuse to drop their prices, while the market crashes around them.”

I am amazed at the number of failing “mover-uppers” trying to sell at the moment. Many of their properties are incredibly boring, ugly, C-list junkers, listed at much higher than municipal evaluation. Would they repurchase their own garbage?

On the sticky price note, we know one seller couple in particular who have been trying to sell their “Taj” for years. They’ve now dropped 150K and still no nibbles. One mover-upper couple with a house to sell first came by with an inspector and ended up running the other way.

So, they repaired and renovated. Cheaply and very badly. Crickets. Of course, now they are feeling even stickier because of the recent capital outlay. The HELOC on this property used to buy another property likely costs them around 2K a month, based upon absolute lowest rates (told us what they owe). The really dumb thing is that it would take just over a year to make good on a realistic price in terms of not having to pay interest, coupled with say, a pathetic GIC return. I figure they’ve lost about 117K already…….and counting. Yowza.

Their stickiness, in retirement, is costing them the most precious time of their lives. Soon they’ll no longer be able to engage in the retirement activities they’d hoped for.

Amazing that so many value money over time.

#97 bdwy sktrn on 06.17.16 at 8:56 am

Fed’s Bullard: Only one rate hike needed through 2018

St. Louis Fed President Jim Bullard, in a significant shift in his outlook for the economy, now says low growth and a very low fed funds rate of just 63 basis points will likely remain in place through 2018.

Bullard, reversing earlier forecasts that looked for growth to pick up and rates to rise, now says 2 percent growth is the most likely forecast and that rates will remain low.

#98 economictsunami on 06.17.16 at 9:05 am

Things that make you go Hmmm…

Canadian Bank Chiefs Put Mansions On Sale After Warnings

http://www.huffingtonpost.ca/2016/06/16/bank-execs-put-homes-on-sale_n_10508922.html?utm_hp_ref=canada-business&ir=Canada+Business

#99 Life among the Stars on 06.17.16 at 9:25 am

#90 Noel on 06.17.16 at 8:02 am

…40% of young adults still live with their parents. How is any of this remotely positive?
____________________

How is this a bad thing? Its also largely a cultural thing. I know you don’t respect other people’s opinions, but I figured you would respect a frugal lifestyle and longstanding cultural traditions of intergenerational living.

Frugality does not fuel the economy nor create jobs. — Garth

Well the T2 gang sure ain’t frugal!!.. spend spend spend…stimulate that economy! Create jobs!

#100 Noel on 06.17.16 at 9:47 am

Frugality does not fuel the economy nor create jobs. — Garth
_____________

Neither will borrowing money you can’t afford to in order to buy a house… An increase in time spent living with one’s parents is a good way to save up for a downpayment (or just save up), and will reduce the debt-to-income ratios so many economists are wringing their hands over.

Interestingly enough, intergenerational living is correlated with income inequality, so one way to prevent the ‘delayed takeoff syndrome’ is to have more redistributive tax policies.

http://freakonomics.com/2012/01/19/is-higher-income-inequality-associated-with-lower-intergenerational-mobility/

#101 A Canadian Abroad on 06.17.16 at 9:56 am

Trudeau refers to Vancouver/TO Real Estate as a “crisis” for the first time in local and international news

“…that we (need to) address this housing crisis” – Trudeau

“Trudeau in his comments told leaders there are federal objectives but … are facing the most acute housing crisis and homelessness problem …”

That’s a BIG RED FLAG to those who are RE investors and have not listed their homes for sale (yet). Time is running out!

#102 Noel on 06.17.16 at 10:22 am

#101 A Canadian Abroad on 06.17.16 at 9:56 am
Trudeau refers to Vancouver/TO Real Estate as a “crisis” for the first time in local and international news

“…that we (need to) address this housing crisis” – Trudeau

“Trudeau in his comments told leaders there are federal objectives but … are facing the most acute housing crisis and homelessness problem …”

That’s a BIG RED FLAG to those who are RE investors and have not listed their homes for sale (yet). Time is running out!

_______________

No dude, he’s referring to it as a crisis because young people think its a crisis. The youth vote brought in Trudeau, and he’s paying lip service to what they see as a huge hurdle to getting their lives started. Nothing will come of this, just posturing for popularity with the youth.

You have to look at his comments that you agree with with the same cynicism as you take the comments you disagree with.

#103 gut check on 06.17.16 at 10:37 am

#58 For those about to flop… on 06.16.16 at 10:00 pm
#54 gut check on 06.16.16 at 9:47 pm
@ #52 For those about to flop… on 06.16.16 at 9:39 pm

:D I can only hope I find it again.

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

Hey Gutie ,I like your attitude.

You have been here for a while and I’m sure you studied both sides of the coin and made the right decision.

Did you spend so much money on the house you had to settle for the Kia?: )

Yesterday was a big day in your life …congratulations…

M41BC

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

thank you, I appreciate you saying that. :)
we have been looking, waiting, studying for more than a couple of years and this was the right thing. It *is* pretty ironic though! cheers & thanks again for your thoughtfulness.

#104 Ole Doberman on 06.17.16 at 10:46 am

“”I was informed that all the studio and all one-bedroom condos were already sold out … to the developer’s family and friends.””

http://beta.bnn.ca/vancouver-developers-shutting-out-regular-buyers-with-insider-condo-sales-1.509484

PURE INSANITY

#105 Happy prairie guy on 06.17.16 at 11:08 am

#46 For those about to flop… on 06.16.16 at 9:01 pm

There are no doubt a number of us Manitobans hanging out here, I have only commented a few times, last maybe in January during the “cauliflower discussions”

Watched an interesting doc last night, showing how the wealth has concentrated among the 1% in the US, by Noam Chomsky, “Requiem for the American Dream”

M66MB

#106 Bat Flipper on 06.17.16 at 11:26 am

I will tell you a few secrets about housing.

First, every house is owned by someone. This is 100% home ownership. Just like stocks, every stock is always owned by someone.

Second, when the market turns, only a very small fraction of the people who own stocks cause the prices to move dramatically. Same goes for real estate. If investors or speculators get scared, they will shift the market. A house bought on spec with declining valuation will be quickly sent to market.

Third, when does the market deflate. Prices in GTA/GVR went up quick because of bidding wars. People bidding above and beyond FMV. Prices shot up because every seller now expects these valuations. Sellers are sticky and won’t sell unless they get the price they want unless they are losing money or forced to sell.

For years, media has been cheerleading real estate; however, quite a change in recent weeks in the media.

Now the hard part, deflating the RE gas bag, while bringing in jobs to pick up those thousands of displaced workers.

#107 bdwy sktrn on 06.17.16 at 11:55 am

more stagnation in vancouver.

mark says a 4.4million increase or 133% over just over 2 years equals zero, flat, stagnating prices.

here is 4.4 million reasons why mark can’t get a job. he’s blind to the real world.

from van sun
————————
The house at 6712 Adera St. near 49th Avenue and Granville Street first sold in March 2014 for $3.2 million, and last sold in May, for $7.6 million…

The Adera property sold in July 2015 for $6.4 million before being sold for $7.6 million 10 months later, a $1.2-million profit. The buyer made a gross profit of $120,000 a month or $4,000 a day.

#108 TurnerNation on 06.17.16 at 11:56 am

A friend visited this new HD cafe.

Today’s Harley drivers are soft.
Electric start, suspensions, heated grips, fuel injection, windscreens, radios; air conditioned saddle bags (I might have made up that one).

Soft. Try advancing ignition timing to a few degrees of TDC then kicking into life. Will make man out of you.

Disclosure: cager here.

http://www.bnn.ca/News/2016/6/17/Harley-Davidson-rides-into-the-latte-business-opens-motorcycle-themed-cafe.aspx

#109 Llama on 06.17.16 at 12:00 pm

I find this article interesting – it discusses Chinese capital invested into North American real estate: http://seekingalpha.com/article/3982584-chinese-flight-safety-place-floor-u-s-real-estate?ifp=0

#110 bdwy sktrn on 06.17.16 at 12:07 pm

#104 Ole Doberman on 06.17.16 at 10:46 am
“”I was informed that all the studio and all one-bedroom condos were already sold out … to the developer’s family and friends.””

http://beta.bnn.ca/vancouver-developers-shutting-out-regular-buyers-with-insider-condo-sales-1.509484

PURE INSANITY
———————–
and please tell another country where the legal owner of any property can’t sell it to whom he chooses or when he chooses (except north korea?)

crybaby.

#111 Life amnong the Stars on 06.17.16 at 12:38 pm

#107 TurnerNation on 06.17.16 at 11:56 am

A friend visited this new HD cafe.

Today’s Harley drivers are soft.
Electric start, suspensions, heated grips, fuel injection, windscreens, radios; air conditioned saddle bags (I might have made up that one).

Soft. Try advancing ignition timing to a few degrees of TDC then kicking into life. Will make man out of you.

Disclosure: cager here.

http://www.bnn.ca/News/2016/6/17/Harley-Davidson-rides-into-the-latte-business-opens-motorcycle-themed-cafe.aspx


Dentists, lawyers and financial advisors!

#112 james on 06.17.16 at 12:44 pm

The TRUMPTANIC has hit an iceberg and is taking in lots of water! It is just a matter of time before it sinks to the bottom.

It’s time for SMART Republicans to get in the lifeboats now while they are still available, otherwise they are going down with the Trumpster!

#113 CJBob on 06.17.16 at 12:46 pm

Garth: Brexit looks ugly, and is coming next week. The US race for prez is a joke. Commodities have stalled out, taking our dollar with them.
_________________________
And you’ve also said don’t turn on BNN and ignore all this short term noise.

Brexit will no more effect the house prices in Vancouver as SARS, Ebola, Killer Bees, etc…..

#114 james on 06.17.16 at 12:48 pm

#102 Noel on 06.17.16 at 10:22 am

#101 A Canadian Abroad on 06.17.16 at 9:56 am
Trudeau refers to Vancouver/TO Real Estate as a “crisis” for the first time in local and international news

“…that we (need to) address this housing crisis” – Trudeau

“Trudeau in his comments told leaders there are federal objectives but … are facing the most acute housing crisis and homelessness problem …”
That’s a BIG RED FLAG to those who are RE investors and have not listed their homes for sale (yet). Time is running out!
_______________________________________
No dude, he’s referring to it as a crisis because young people think its a crisis. The youth vote brought in Trudeau, and he’s paying lip service to what they see as a huge hurdle to getting their lives started. Nothing will come of this, just posturing for popularity with the youth.
You have to look at his comments that you agree with with the same cynicism as you take the comments you disagree with.
………………………………………………………………….
Don’t worry be happy, Trudeau pays lip service, makes pot legal so the youth can all get high as hell, forget about ever owning a home and then legally kill themselves after coming down from the high. It’s all part of his master plan.

#115 Lee on 06.17.16 at 12:50 pm

#109

When you apply for a building permit to build a condo development, part of the process is convincing the city that the use you plan to make of the land is in some way consistent with the city’s planning goals. The City of Toronto has no interest in letting residential land be developed unless it fits into a major city’s goals of providing affordable housing to everyone. If you ever go to city counsel meetings where developers try to get permission to build condos, they use phrases like “this development will assist young families”, and “this development is consistent with Toronto’s planning principles”. I am sure that at no point during those submissions do t hey developers say “And by the way, we will not be selling the units to the general public until our friends have had an opportunity to flip them at a profit first”. Projects are sold as benefiting everyone, but then they are sold to a special group of insiders. This is the way many real estate agents make money: they buy pre-construction condos (often with as little as 5% down) and flip them with developer permission as usually the developer lets agents out of the no-assignment clause.

So, this is the way the condo gig operates in Toronto. Then the unit is flipped to an unsuspecting sucker, and then the taxes and maintenance fees are jacked up. Of course, after that condos do not out pace inflation so you end up with dead money tied up.

#116 Smoking Man on 06.17.16 at 1:14 pm

Why I’m I such a good poker player. I always play the player.

If you invest you need know fact from fiction.

When I first saw this greving mom I found her tears not genuine.

Then this interview.
https://www.youtube.com/watch?v=gG9mD3LOKXo

Shot in a studio, look at her glasses, studio monitors with green screen back ground.

Make your own conclusions. But if this was a fiction novel it would be amazing.

Obamer does a false flag to get Hillary support and another excuse for a gun grab…

And then it back fires, trumps popularity soaring among the LGBT…..

HA I never saw that coming….

#117 Smoking Man on 06.17.16 at 1:15 pm

#111 james on 06.17.16 at 12:44 pm
The TRUMPTANIC has hit an iceberg and is taking in lots of water! It is just a matter of time before it sinks to the bottom.

It’s time for SMART Republicans to get in the lifeboats now while they are still available, otherwise they are going down with the Trumpster!
……

Wishfull bias on your part I’m thinking….

#118 Toothless Measures on 06.17.16 at 1:26 pm

Oh look, the realtors have conveniently weighed in with their ‘the market is cooling’ meme at the same time the feds are talking about housing measures.

Does everyone remember when they did that in 2012 and 2014 whenever public sentiment changed from greed to fear, and they put into place their PR spin to placate the masses and politicians?

Lets face it renters, the RE industry has the best lobbyists at the provincial and federal level. They know when to apply pressure, when to cause fear, when to alleviate fear.

Renters – you have no one advocating your position at the federal level – period.

Do you really think that things will change?

You must now believe and hope that the feds will actually introduce meaningful measures to cool the market as rates are off the table now (for maybe 2018), your balanced portfolios are flat or negative, world growth is negative, and any potential black swan events have fizzled (oil plunge, recession watch).

But as we have seen since 2009, all the federal ‘cooling measures’ have been toothless and have simply stimulated the market. What are the odds of any new measures doing the same thing? Hmmmmm…….

Do you know who correctly predicted 10 years of emergency interest rates – realtors did. While there is an inherent self-interest in making these claims years ago, in a few more years, they will have the only ones with the correct prediction.

Everyone is moderating their position on rate increase and US growth an pushing timelines for a correction down the road.

A lost decade for those renting and waiting.

#119 Blacksheep on 06.17.16 at 1:36 pm

A canadian #101, Noel # 102, James #113,

Heard JT on CBC this morning.

I’m paraphrasing here, but he pretty much, politely washed his hands of a national solution saying the federal gov. has to consider that any actions applied, needs to work for hot AND cold markets and that all RE is regional, meaning VAN is Christy baby’s problem.

He even mirrored Christy C’s previous statements, that they want to ‘stabilize RE markets’, but not place recent buyer’s in jeopardy buy causing price corrections.

By the way, Is C.C. back from her ‘2016 Vancouver RE promo tour’, in China?

Remember, “Don’t fight the Fed” in the US.

When it comes to canadian RE, it’s “Don’t fight the system”

#120 Ole Doberman on 06.17.16 at 1:40 pm

Man with all the publicity housings’ been getting lately can this be the top, meaning the powers that be/establishment/1% are getting ready to dump onto the unassuming general public:

http://www.bnn.ca/Video/player.aspx?vid=893993

It’s always the same the rich get richer while the poor get poorer.

How many times have we seen this in the stock market – later, rinse, repeat I guess.

#121 Ole Doberman on 06.17.16 at 1:45 pm

Simply surreal 9/10 houses in Vancity worth over $1 million:

http://beta.bnn.ca/nine-out-of-10-vancouver-houses-now-worth-more-than-1m-study-1.509478

Let’s not talk about the 80’s/90’s housing bust – today it’s HAM mania as the common denominator.

#122 Its Civil Baby on 06.17.16 at 2:15 pm

#114 Lee on 06.17.16 at 12:50 pm

#109
When you apply for a building permit to build a condo development, part of the process is convincing the city that the use you plan to make of the land is in some way consistent with the city’s planning goals. The City of Toronto has no interest in letting residential land be developed unless it fits into a major city’s goals of providing affordable housing to everyone. If you ever go to city counsel meetings where developers try to get permission to build condos, they use phrases like “this development will assist young families”, and “this development is consistent with Toronto’s planning principles”. I am sure that at no point during those submissions do t hey developers say “And by the way, we will not be selling the units to the general public until our friends have had an opportunity to flip them at a profit first”. Projects are sold as benefiting everyone, but then they are sold to a special group of insiders. This is the way many real estate agents make money: they buy pre-construction condos (often with as little as 5% down) and flip them with developer permission as usually the developer lets agents out of the no-assignment clause.

So, this is the way the condo gig operates in Toronto. Then the unit is flipped to an unsuspecting sucker, and then the taxes and maintenance fees are jacked up. Of course, after that condos do not out pace inflation so you end up with dead money tied up.
*******************************************
The best part of this Condo fraud is that most people are stupid in believing that these palatial concrete menageries will be around for hundreds of year. Many of these fancy buildings that were constructed at the beginning of this condo boom are already facing high repair costs, and in many cases lawsuits, because they are built so shoddy. What a lot of people fail to understand is that they have a certain life cycle. They are okay for the first five years, they gradually deteriorate by year 10 … and don’t even reach year 20 before significant remedial work needs to be done. In 50 years these buildings may well become an urban slum.
https://www.thestar.com/business/2015/02/13/the-real-costs-of-maintenance-fees.html
http://www.metronews.ca/features/toronto/toronto-condo-fraud/2013/09/12/toronto-condo-fraud-corruption-in-maintenance-and-repairs-fees.html

#123 Linda on 06.17.16 at 2:39 pm

“When rates reset….”

What if the banks won’t refinance because you don’t have the income to support a mortgage given to you pre-2012 when Canadian banks were doing NINJA loans?

What if the banks decide they will NOT appraise a property at today’s value because they do not see it continuing to rise?

What if you get sick, lose your job, etc. and you are so high in debt you have to sell your house?

Rates resetting higher is just ONE part of the equation.

#124 Neil Armstrong on 06.17.16 at 3:12 pm

Bank of Canada appears worried about FinTech… can you say Disruption? Haha.

http://www.bankofcanada.ca/2016/06/fintech-financial-ecosystem-evolution-revolution/

Years ago it became evident to me that speculators were out of control flipping homes, and is why I got out of the market. Prices will easily fall 80% in the bubbliest areas, back in line with wages, and back to 2009 prices or worse. I can wait.

http://globalnews.ca/news/2768447/vancouver-homes-being-flipped-like-cheap-penny-stocks-according-to-realtor/

#125 SWL on 06.17.16 at 3:13 pm

#107 TunnerNation – I once worked with a crusty old welder who used to hobble around. One day I asked about his limp. He said he busted his knee twice from kick starting a Harley.

I suggested he buy something with an electric start

#126 Dan Duran on 06.17.16 at 3:34 pm

You don’t even know what ‘peak housing’ means.. It means peak supply (of land for detached homes). It’s true, that has been the reality for a few years now.. Not even sure what bears have to hope now. VanCity and Toronto surely are not ‘one trick pony’ and won’t fall off the cliff, but you seems to be hoping and pressuring the socialists in the government to make a mistake, take us down the Venezuela road. I have news for you: even if that was to happen, you won’t have much to cheer about, except for seeing the fellow home owners take a bath. Your cash in the bank won’t be safe. Your gold will be nationalized, you’ll probably lose your job, so go on, pray that they will tax tax tax homeowners, foreigners… (somebody, anybody, please!!!) into poverty so you’ll have something to cheer about, at last – after all these years.

#127 Dan Duran on 06.17.16 at 3:38 pm

@ Linda: hope away: The mortgage will be renewed with no proof of income or appraisal, provided you stay with the same bank, and it didn’t go under water. But if it does go under water, they’ll first take your savings… if that keeps them in business, the homeowner will get his mortgage. you lose.

#128 bdwy sktrn on 06.17.16 at 3:47 pm

oh god, not another one!!!
***********************
Vancouver Housing ‘Vulnerable To A Marked Correction’: RBC

A report from RBC released Thursday says Vancouver’s housing market is “vulnerable to a marked correction.” For a market analysis from a major bank, those are pretty strong words.

“Typical Vancouver-area homebuyers would need to allocate 92 per cent of their income to carry the costs of a two-storey home (based on market price) and almost 45 per cent for a condominium apartment,” the report stated.
————————-
add another bank to the list of 604 doomsayers.

RBC should know best as they are the most powerful and best connected bank in canada.

oh, wait just a minute , this rbc report was from FOUR years ago. whoopsie!

guess they will keep their mouths shut on this latest round of ‘warnings’.

http://www.bloomberg.com/news/articles/2012-04-26/toronto-vancouver-housing-vulnerable-economists-warn

#129 young & foolish on 06.17.16 at 3:51 pm

“Reverting to the mean” … a wise phrase used to temper runaway valuations in markets. But does this refer to government debt as well? Didn’t think so. First world government debt has been growing steadily since WW2 and has been increasingly the fuel for all global “growth”. When credit dried up in 2008, economies nearly collapsed (until government stepped in).

The resulting distortion of markets has made classical capitalism (the kind that allows markets to “revert to the mean”) almost impossible. Low growth, low interest rates, stagnant wages, huge debt, and inflated assets may be with us for a long time.

#130 Boo Hoo on 06.17.16 at 4:07 pm

I don’t think rates are going to have much impact on people. While rates do go up, so too does principal go down as time passes. Let’s also not forget that with the passage of time principal loses its value because of inflation. An $800,000 mortgage will only be about $450,000 in ten years. With inflation, that $450,000 will only feel like about $350,000. A couple of ticks more of interest won’t bury this borrower. It will be tough, but doable for most. This is why rates are going up slowly. Governments know people need time to adjust. This will gradually cool price increases in Toronto. It won’t crash them. You’ll never see a sfh under $1.0 Million again in Toronto. Just accept it and plan on how to deal with it. Hoping for a miracle is ridiculous.

#131 Brazil ex-pat on 06.17.16 at 4:07 pm

#1 bitcoin_fanatic on 06.16.16 at 6:35 pm
Made some money on bitcoin today. Now to figure out how to report it on my tax return. A good problem to have =]

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

Indeed…for 5 years we are told Bitcoin will go to zero. RE in Moldcouver will collapse. And the Fed will raise rates. All incorrect. I would not want to be making a living as a forecaster right now.

#132 young & foolish on 06.17.16 at 4:25 pm

“Not sure there’s any comparison between the loser markets you mention above and the two cities of Vancouver and Toronto. Young people and immigrants want to live in Canada’s only two cities worth living in. They are generating the jobs and the excitement and the quality of life.”

This is true, and will continue to keep prices much higher in Van City & GTA … most places are still “urbanising” and demographic studies show the emergence of new tech/service economies growing up withing large cities. Demand will be there, supply will be controlled. Either way, you will pay somebody for a roof over your head.

#133 Toothless Measures on 06.17.16 at 4:35 pm

Heard JT on CBC this morning.

I’m paraphrasing here, but he pretty much, politely washed his hands of a national solution saying the federal gov. has to consider that any actions applied, needs to work for hot AND cold markets and that all RE is regional, meaning VAN is Christy baby’s problem.

He even mirrored Christy C’s previous statements, that they want to ‘stabilize RE markets’, but not place recent buyer’s in jeopardy buy causing price corrections.

By the way, Is C.C. back from her ‘2016 Vancouver RE promo tour’, in China?

Remember, “Don’t fight the Fed” in the US.

When it comes to canadian RE, it’s “Don’t fight the system”

————

As I said a few days ago, when the embers of hope for a correction were breathed on with the announcement of pending federal ‘policy measures’, no action will take place.

Nobody wants to touch this hot potatoe, especially when it constitutes 25% of Canada’s GDP.

The cards will forever be stacked against you renters and cashed out sideliners.

Abandon all hope ye waiting renters. Nothing is going to change. The nugget of hope that something could be done has just be crushed.

So what it the next hope for a correction?

1. Interest Rates – Yellen cries wolf for years, did not pull the trigger when she should have, and now you are heading into a US recession with a rate cut pending (and lets not make definitive statements that it cannot happen since we have all learned the lesson of making definitive statements on them today).

2. Recession? Oil lost half its value, and its impact spread throughout the country from Vancouver Island to Nova Scotia. The country is still humming.

3. Foreign Capital Drying Up? When a certain country’s economy does well, people flee with cash to TO and Van. When a certain country’s economy is doing bad and faltering, people with cash flee to TO and Van. Its an unchanged variable.

4. Buyer Fatigue? The next largest generation, the Millennials, will absorb any decline in demand and prices as they have been instructed by, and witness to, their baby boomer parent’s windfall for screwing over own kids with inflated prices. Throw in for good measure 300,000 new residents entering the country every year, the hundreds of thousands of temporary foreign works, and hundreds of thousands of ESL students using their education as a back door to permanent residency for their families, and you have an endless supply of people happy to purchase hard assets rather than soft stocks.

5. Political Will? That is rich – hah- and self explanatory. What is the number one economic generator in those provinces with hot markets? Figure that out, and you decide if those in charge want the revenue lever changed or turned off.

#134 Brazil ex-pat on 06.17.16 at 4:43 pm

Not allowing my bitcoin post….all true facts…….Garth you did an article about “no censorship” on your blog. Was that article censored too?

Loser. — Garth

#135 Brazil ex-pat on 06.17.16 at 4:44 pm

Crap…..now I look like a boob…..sorry :-(

#136 Metaxa on 06.17.16 at 4:56 pm

@ Smoking Man

I don’t think you know how or when a green screen is used, neither does the whacko outfit that put the video out.

to wholeheartedly jump into that odious conspiracy of Orlando being done purposefully by “actors” shows how bereft of critical thought you and your sycophants are.

You minimize or ignore the terrible loss of lives, the anguish of those left behind for what? Your own inarticulate purpose?

What a man, keep it up, expose yourself for what you really are.

#137 Grey Dog on 06.17.16 at 5:07 pm

Within the last month, visited friends who have for 2 years, tried to sell their executive home with property in Moncton, problem, there just are no new executives and industry in town to move this property. An absolutely beautiful spot at a price of a mid range condo in 416.

#138 Smoking Man on 06.17.16 at 5:31 pm

#135 Metaxa on 06.17.16 at 4:56 pm
@ Smoking Man

I don’t think you know how or when a green screen is used, neither does the whacko outfit that put the video out.

to wholeheartedly jump into that odious conspiracy of Orlando being done purposefully by “actors” shows how bereft of critical thought you and your sycophants are.

You minimize or ignore the terrible loss of lives, the anguish of those left behind for what? Your own inarticulate purpose?

What a man, keep it up, expose yourself for what you really are.
…………………

You’re so gullible. !!!!

My guess you went a long way in school.

I know first hand what losing someone young in the family feels like. I know what grief really looks like.

Sorry I haven’t seen it in the clips yet. Please put a video up here that shows real grief. Or even people getting loaded in ambulances.

I can’t find them anywhere. Only the two bit actors…..

#139 WUL on 06.17.16 at 5:36 pm

This evening Dustin Johnson will receive texts from the USGA, CBS Sports and Wayne and Paulina Gretzky.

“Quit spitting on the hallowed ground of Oakmont.”

Bad form.

#140 Linda on 06.17.16 at 9:33 pm

@danduran
I wish it were that easy….
8/10 refinance and you are absolutely right the bank will do your mortgage if you are employed.
They also cannot take your savings to pay your mortgage. If assets are held jointly with someone other than the person joint on the mortgage, the Bank can’t touch it. The mortgage goes to default around 90 days, legal proceedings to sell shortly after.
Just how your family members are not responsible for the debts you leave when you die, the only way to repay the debt on a house is to sell it.
Foreclosure: bank takes title.
Power of Sale: bank sells house, takes their money, you get the rest.

#141 Barb on 06.18.16 at 6:13 pm

T2 is even more of an idiot than his father.

We shouldn’t be surprised.
Trust fund kiddies lack the ability to create a sound priority list.

Over the last month, no-one even admits voting for the nutcase.