The snorflers

BEER FEED modified

Sad people with empty lives and no friends, who read this drivel daily, will know Kelvin. He’s the dude with the hot, young wife and sexy new accounting job (they get all the babes) in San Francisco, featured here yesterday.

But this is not about him. It’s about bubbles, foreigners and urban myths. Plus, San Fran. If you haven’t been there, go. A memorable place, now one of the globe’s coolest cities since it’s a hotbed of technological innovation, a magnet for the best minds of a generation. With a spooky, deserted prison in the middle of the bay. And very expensive houses.

People in Vancouver like to compare their city to this one, and maybe they should. Like YVR, northern California attracts foreign investors who often shovel money into residential real estate. Last year 16% of all house sales in the area went to foreigners, which is roughly double the number in Vancouver.

So why did Frisco house prices increase by only 10% in 2015 and just 5% over the past 12 month period? Howcum there’s a puny 0.8% appreciation expected in the next year? Meanwhile Vancouver prices bloated by an astonishing 32% – with everyone is blaming those damn foreigners.

Hmm, or how about Miami? Chinese dudes there, too. Almost a quarter of all sales in Florida last year went to offshore buyers, yet Miami house prices rose by only 7%. So why is it, with far fewer foreign dollars flowing into YVR or the GTA than major US cities, we have gasbag markets, rampant house horniness and excessive price increases? Could it (gasp) be us?

You betcha, says a new report from UK-based Capital Economics. Canadians are basically nuts. “We are sceptical of claims that Canada’s housing bubble is primarily due to foreign investors. Blaming foreigners for a country’s problems has always been a handy fall-back for politicians; whether it’s a lack of jobs, crime or, in this case, housing affordability. This is mainly a home-grown problem caused by low interest rates and irresponsible lending.”

Does any of this sound vaguely familiar? It should. With fewer than 10% of sales in YVR going to non-residents, it means over 90% of trades are local-to-local. So how can prices jump exponentially when the economy is sucking air and household incomes are stagnant? Does this “prove” that a river of foreign money is forcing house prices beyond the means of native Canadians – who now cast themselves as victims?

Nope. Forget that, says Capital Economics. This advancing train wreck has been gassed with debt.

As detailed here in recent months, borrowers in Toronto and Vancouver have been snorfling mortgage money as never before, convinced they can borrow endless amounts because (of course) real estate always goes up. Four in 10 mortgages in Toronto are carried by people with debt equal to 450% or more of their incomes, with a third of Vancouver homeowners in the same leaky boat.

But it gets worse.

Says the firm: “We’re reliably informed that the mortgages in Toronto now stretch to 600% of combined gross income. So two people both earning $100,000 gross can borrow $1,200,000. What has really changed in the past 12 months is not a big increase in foreign buyers, but a further decline in interest rates, which has allowed lenders to relax lending standards even further.”

Never before have houses cost this much. Never before have people owed this much. The negative correlation between interest rates and household debt is almost perfect. Now that the economy’s swampy, jobs are being lost, trade is down and taxes are up, it’s starting to come unravelled, as this pathetic blog has been documenting with the regularity of a manic golden retriever. Detached sales are falling, listings are edging higher and the sales/list ratio has eroded.

This week CREA admitted home sales have now declined three times in three months. (In Calgary the score is 20 out of 20.) Nationally, house sales fell last month at an annualized rate of more than 15%, with negative numbers also compared to this time last year. Despite this drop in activity, prices keep rising – the Canadian average was 9.9% higher over 12 months, with the realtor Frankenumber up more than 14%. As you know, Toronto added 16% and YVR popped by 32%. Hard to see this as anything other than the final spurt before the inevitable slump.

So if you accept the argument that insane housing valuations were caused by locals now hitting a debt and income wall, you know we’re probably in for a pooching. If, on the other hand, you believe foreigners have single-handedly shoved prices into orbit, then the collapse in deals following BC’s Chinese Dudes tax suggests the same outcome. Either way, it’s over.

Kelvin dodged a bullet.

186 comments ↓

#1 Manderson on 08.17.16 at 6:30 pm

Fiiiiirstah!

#2 ShawnG in TO on 08.17.16 at 6:32 pm

who’s lending at 600%? they need to be shorted

#3 Moron Face on 08.17.16 at 6:34 pm

I am become death.

#4 Bill Gable on 08.17.16 at 6:41 pm

Mr. Turner – in Vancouver Real Estate stupidity, is riding neck and neck with Pokemon.

Today – yet another classic.

Thank you.

#5 Alberta Ed on 08.17.16 at 6:41 pm

SF also has Ghiradelli’s Chocolate Factory, where you can get the best chocolate sundaes on Earth, as well as cool cable-cars and the Golden Gate Bridge. Neat place. Until the next earthquake, that is.

#6 White Crock BC on 08.17.16 at 6:41 pm

“Either way, it’s over.”

-Garth Turner

“It ain’t over ’til it’s over”

-Yogi Berra

It ain’t over.

#7 Jimmy on 08.17.16 at 6:41 pm

First!

#8 anon on 08.17.16 at 6:44 pm

And yet Calgary home prices are down a paltry 3-4%

#9 Victoria Real Estate Update on 08.17.16 at 6:46 pm

SALES OF DETACHED HOUSES SLOW DRAMATICALLY DURING NORMALLY BUSY MONTHS

. . . . . . . .Greater Victoria. . . . . . . .
Monthly Detached House Sales Totals
. . . . . Compared to April 2016. . . . . .
———————————————————–
April…….*******************
May…….***************
June……************
July……..***
————————————————————
. . . .-40%. . . . . -20%. . . . . .0%.

(Source: Victoria’s R/E board)

Sales of detached houses were down 23% month-over-month across Greater Victoria. It’s apparent this is part of a trend that began after April.

Monthly sales totals compared to April 2016:
May: down 9%
June: down 17%
July: down 36%

BUYERS BACK OFF IN VICTORIA

More and more properties are sitting on the market unsold, despite low inventory levels. There’s only one way to explain this: demand is dropping quickly.

The local real estate board’s explanation of July’s big drop in sales is particularly lame – they blame it on low inventory levels.

If that was true and it wasn’t a case of falling demand, then the following properties would have been snapped up quickly a long time ago (some of many examples):

* 3455 Bethune Avenue – days on market: approx. 95
* 106-4040 Borden Street – days on market: 95
* 202-76 Gorge Road West – days on market: 135

Of course, real estate boards are in the business of creating sales activity, so why would you buy their lame explanation?

Clearly this is more of the same from local realtors. In early 2015, the local media quoted local realtors as saying buyers from China “had suddenly discovered Victoria” and that they were “moving the market”.

Then the stats from the local board showed that only 0.68% of deals went to buyers from all of Asia. (See first chart.)

Fail !

#10 JO on 08.17.16 at 6:47 pm

It’s about time. We need a nasty correction in this country because the system is completely out of control.
Lots of blame to go around but push come to shove 95% of the blame lies with the moron borrowers.
We have built a junk economy where the primary driver of gdp/ income, asset prices, tax revenues etc is an out of control debt bubble based on shelter. The median salary has gone nowhere for years in real terms and most young recent buyers are total idiots – they deserve to get wiped out
Using these financial illiterate and mostly broke debt slaves to inflate the cost of our shelter and associated living expenses is an outrage
Let’s hope for a healthy 15-20% dip before the federal govts new plan to flood Canada with foreign buyers starts up

#11 Shortymac on 08.17.16 at 6:48 pm

It almost makes me want to take out a small mortgage but never buy a house, just invest the cash. I can’t finagle that while renting however.

#12 james on 08.17.16 at 6:50 pm

Excellent post. Poignant, although I think most Canadians have cognitive dissonance when it comes to housing.

This is bang on. There is far more foreign purchasing in the Bay Area and Seattle than in Vancouver. Lots of foreign money, and locals complaining about it. Median salaries are higher, average salaries are higher, disposable income is higher, career prospects are better, etc etc. Plus you have mortgage interest deductions, property tax deductions and a host of other incentives that even people on work visas can take advantage of.

Yet, the Bay Area has slowed. Seattle is also moderating in terms of price gains, despite very low months of inventory. Not to mention that both of those cities experienced crashes in the recent past.

There is a different mindset. In both of these cities high real estate prices have been looked upon as a PROBLEM. People have experience with bubbles, they are aware that high housing and rental costs make it difficult for teachers, police officers, labourers (etc) to live in reasonable distance to their workplace. They know that it is a disincentive to business formation, to labour mobility, etc.

Many of the Bay Area municipalities have been discussing these issues for a long time. In Silicon Valley the housing prices are seen as a nuisance and impediment, because the people there have the antiquated view that wealth comes through having a good career or starting a successful company that offers value.

In Canada, in contrast, people view housing as the route to wealth. Old fogies bequeath vast sums from HELOCs to their children or grandchildren to enter the market, since it is seen as the path to upward mobility.

Completely different mindsets. I can tell you which one empowers people, and which one creates a nation of neurotic weirdos who go apoplectic when you question the sanity of using a house as a retirement vehicle.

#13 Victoria Real Estate Update on 08.17.16 at 6:51 pm

CANADA’S MASSIVE HOUSING BUBBLE – INFLATED BY LAX LENDING STANDARDS / POOR ENFORCEMENT (ALLOWING MORTGAGE FRAUD)

Experts around the world agree: Canada has had a housing bubble for some time. The Economist says Canada’s housing market is overvalued by almost 90% compared to rents and over 30% compared to incomes. In comparison, the US housing market is, in general, not overvalued.

That Canadians and Americans share similar income levels and similar mortgage rates, makes it possible to point out how overvalued Canadian homes are by looking at specific examples.

YOU KNOW THAT CANADA’S LAX LENDING STANDARDS HAVE ALLOWED HOUSE PRICES ACROSS CANADA TO BECOME DANGEROUSLY OVERINFLATED WHEN:

Canadians paying with Canadian dollars are looking at $380 K for this house in Moose Jaw, SK (google the entire next line to see the listing)

719 Skipton Road, Moose Jaw, SK for sale

AND WHEN, AT THE SAME TIME, Americans paying with American dollars, are looking at the following prices for similar homes. (Min. 1,800 sq. ft. main, above ground, living area, min. 3 beds, 2 baths, 2006 or newer and an attached double garage)

California:

$490 K, San Diego, CA

Florida:

$150 K, Jacksonville, FL

$158 K, Palm Bay, FL

$247 K, Davenport, FL (Backyard pool, 2,901 sq. ft.)

Arizona:

$112 K, Florence, AZ (Phoenix)

$113 K, Coolidge, AZ (Phoenix)

The last time I posted examples like these, a realtor wrote one of the most ridiculous comments I’ve seen on Garth’s blog by saying that no Americans want to live in Florida or Arizona.

Florida population: 20 million
Arizona population: 6.8 million

Are millions of Americans being held against their will in Florida and Arizona? A realtor on this site seems to think so.

#14 Victoria Real Estate Update on 08.17.16 at 6:54 pm

$150 K, Jacksonville, FL

#15 Context on 08.17.16 at 6:59 pm

The next time any of you vacation in SF take lots of green and book an expensive hotel beside Union Square. I recommend you make reservations at this dinner joint down the street called John’s Grill as on the second floor even have a jazz band. This restaurant has a history to explore and take your autograph book with you as you never know who is there. How about one of the best restaurants in USA.

#16 Bank of Millennial on 08.17.16 at 7:09 pm

Thank you for confirming exactly what I was concerned about..

Your worth your weight in gold buddy ($3.6million), probably more then that even.

#17 greaterfool clone on 08.17.16 at 7:12 pm

Here is what Garths clone has to say about avoiding bubbles in the housing market:

http://www.bnn.ca/taxes-are-best-tools-to-avoid-housing-bust-nobel-economist-joseph-stiglitz-says-1.548917

And I thought BNN was not a reliable network…they remind me of this blog too much.

#18 Robert on 08.17.16 at 7:15 pm

The world economy is experiencing the witches brew of widespread currency devaluation (aka quantitative easing, or emergency interest rates, or currency wars). In Canada, the solution to the troubles of 2008 was to inflate a property bubble (thanks Harpo and Flattery) to buy a majority government. Having sent us over the slippery slope no one since has been willing to pop the gas bag. In BC, the 15% non resident tax is simply a pre-election lever to move players from the YVR slots over to other regions with a minimum of fuss. Not so much a penalty as an inducement to play elsewhere. The MSM since dutifully reports sad tales of students whose overseas parents are disappointed at the extra expense of buying their swains an investment home. If debt is fueling our bubble then why is CMHC is spreading snorfler bait for non-resident foreign speccers?

#19 Game On on 08.17.16 at 7:15 pm

Uh oh BC and Vancouver, looks like your little 15% tax will be circumvented by a new wave of Chinese visa holders.

I see that Miami and San Fran do not have to contend with the new super visa….

http://news.nationalpost.com/full-comment/terry-glavin-canadas-servile-relationship-with-china

“If there is another plausible explanation for McCallum’s surprise “request” last week that Beijing allow the tripling of visa application centres in China with a view to radically boosting the number of Chinese students and temporary foreign workers in Canada, that explanation has not come from McCallum. All we’ve heard is the usual treacle about Canada’s openness to the world.”

#20 Bram on 08.17.16 at 7:18 pm

#2 ShawnG in TO on 08.17.16 at 6:32 pm
who’s lending at 600%? they need to be shorted

It sounds worse than it is.
It’s not 1980 anymore, and interest rates are lower than ever.

This makes a 600% mortgage a lot more bearable than it used to be, provided amortization period is really long, or if it is a interest-only mortgage (rare in Canada.)

Is it risky? Yes, long term rates can go up.
But I give it better than 50% chance that interest rates will go even lower, and stay near zero for a long long time.

Those mortgaged-to-the-hilt may pull it off just fine. Or maybe the won’t.

#21 About that irresponsible lending on 08.17.16 at 7:20 pm

Yes, the lending has been irresponsible but as part of my mandate as a picky wordsmith, I would add that the borrowing has been irresponsible too to say the least. It might also be called suicidal but time will tell.

Banks are businesses meaning they must profit. I do not recall any news reports of unruly hordes of bank loan officers beating people on the streets to force them to take on mortgages.

#22 Scumop on 08.17.16 at 7:21 pm

Your tactics at explaining the situation fail, Garth, because you use verifiable numbers and references to prove what you say.

The sucke errr, buyers only listen to emotional appeals. The brain is just wired that way in most people. You, me, and a few others here must be exceptionally damaged because numbers and facts work for us.

Moar numbers & facts please.

#23 nonplused on 08.17.16 at 7:26 pm

I’ve been to San Francisco it’s nice but I’d take a pass on Oakland and Berkley.

#24 paulo on 08.17.16 at 7:26 pm

#2
they all are here is a interesting story, my youngest son 1 yr out of college, with effectively 1 years credit history
small car loan 2 credit cards with 0 carrying bal , kids got
about 4k in cash, 7200 in the tfsa and a JR Management position that pays 50K/yr been on the job a year 625 beacon and 1 yrs worth of R1’s on the credit score
decides to get a pre qualification for a mortgage on a whim,he is not getting into this market he listens to dad
any way long story short, after this experiment the kid ends up with 3 potential lenders,all members of the big 5 that are prepared to advance and provide letters of commitment in amounts ranging from 465K to 510K !!!
kid makes 50K /yr you do the math i did its absolutely
ridiculous and defiantly part of the problem wouldn’t you agree

#25 WallOfWorry on 08.17.16 at 7:27 pm

Interesting and troubling numbers but how does it work? Financing through the banks is based upon ability to pay? Are you suggesting that the banks are approving mortgages where they have accepted high risk profiles? And for those who don’t have appropriate down payment there is CMCH insurance that you have to get through?

Personally, I just wish that the Canadian real estate market would hurry up and correct so that we don’t have to listen to everybody calling the top for the last five years.

#26 Victoria Real Estate Update on 08.17.16 at 7:27 pm

Correction: Bethune days on market: approx. 75

#27 Nat on 08.17.16 at 7:30 pm

Garth-As much as I would like to believe that it is locals creating this problem I think we need to really find out who is considered a foreigner. I am seeing a lot of foreigners-be it Asians, Middle Easterners etc who have Canadian residency and have large purchasing power because they either own businesses overseas (which are probably taxed much lower) and wire their money over to Canada. Sure-on paper they are not considered a foreigner-but they sure have an advantage over local citizens who are probably paying a lot more tax and can’t save as fast for their home. As well, if you have money and move to Canada your chances of becoming a Citizen are high.

#28 F.dover on 08.17.16 at 7:39 pm

http://www.viewpoint.ca/sidebarmap#!/summary/30231328/zoom/17

This is the one to be horny about, the rest of the market, meh.

#29 Victoria the original on 08.17.16 at 7:41 pm

Clearly this is more of the same from local realtors. In early 2015, the local media quoted local realtors as saying buyers from China “had suddenly discovered Victoria” and that they were “moving the market”.

I heard today that buyers from Vancouver were buying all of Victoria’s houses… sigh …. before it was the Americans then the Europeans (notably germans)….

#30 Victoria Real Estate Update on 08.17.16 at 7:42 pm

# 10 JO

You must have missed the facts Garth presented about how foreign buyer activity is significantly higher in several US cities than in Canadian cities – yet prices in the US are generally significantly lower.

Even if there were more foreign buyers in Canadian cities, it wouldn’t keep house prices from correcting to depths unimaginable by most Canadians. San Francisco, LA, San Diego, Las Vegas, Miami, etc. all had plenty of foreign buyer activity before their housing markets crashed.

It isn’t different in Canada.

#31 For those about to flop... on 08.17.16 at 7:44 pm

#6 Context on 08.17.16 at 6:59 pm
The next time any of you vacation in SF take lots of green and book an expensive hotel beside Union Square. I recommend you make reservations at this dinner joint down the street called John’s Grill as on the second floor even have a jazz band. This restaurant has a history to explore and take your autograph book with you as you never know who is there. How about one of the best restaurants in USA.

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

Hey Context,ever been to The Stinking Rose in San Fran?

It’s a must for lovers of all things garlic.

They have even got garlic ice cream,maybe not a hit in Caledon

Take a few friends and a pack of chewing gum…

M42BC

#32 Mean Gene on 08.17.16 at 7:44 pm

I have a buddy who works in the electrical field, a major electrical manufacturer in Metro Vancouver is getting rid of 50 unionised staff this fall, the jobs going back to a non-union plant back east. :-p

#33 paulo on 08.17.16 at 7:46 pm

#25
i suspect you may have hit the proverbial nail on the head
i have to believe the banks are engaging in a form of QE, trying to keep the cycle alive a risky play

#34 mouldyinYVR on 08.17.16 at 7:47 pm

…..UK-based Capital Economics says Canadians are basically nuts….
…..look there’s ‘nuts’ and then there is ‘mentally incompetent’. I think we fall into the second category.
How can we explain our incredibly lax lending standards, our inane attitude to debt etc. The only really unfortunate outcome is that the taxpayers will pick up the tab when this bubble bursts and the banks will walk away unscathed (thanks CMHC).
Don’t think that we are all going to get accomodation at a vastly reduced rate. The banks will pull back on granting mortgages, we will need massive downpayments and when the tide goes out all we will see in YVR will be shoddily built homes that no one – no -not even you will want. Depreciation Reports anyone??

#35 Context on 08.17.16 at 7:48 pm

Golden Retriever – The attorney in Mexico knows his retirement has been destroyed as cannot fly to USA or even Europe anymore for his little vacations. His dog a year ago met a female Golden puppy at the dog park for play fighting. She would chase away the bigger dogs to protect him, and ever since that day waits outside for her boyfriend as the three walk together to the dog park. This attorney reminds me that he got a masters degree at Oxford as knows the problem. He can sleep at night but the dog can’t as its too hot living on the Pacific and wanders around at night trashing the joint. I said why not close the door and replied was an idiot as he would trash it. Solution – he bought an air conditioner and the contractors have to smash a hole in the wall now so his Golden boy can sleep at night. His sordid life amounts to staying at home and walking back and forth to the dog park while the dogs trash the garbage bags that are piled up on the corner waiting for a pickup only three times a week,

#36 WallOfWorry on 08.17.16 at 7:56 pm

#25….with 3 potential lenders,all members of the big 5 that are prepared to advance and provide letters of commitment in amounts ranging from 465K to 510K !!!”

Seems far fetched…a very good friend who works at the Major bank suggests to me that unless co-signed there is no way that is happening unless other details not provided.

#37 acdel on 08.17.16 at 7:57 pm

Good one Garth, spot on..

————————-

Meanwhile in Calgary, job seekers turned away from low income jobs due to too many appearing at the job fair. Sad situation.

http://www.cbc.ca/news/canada/calgary/airport-terminal-jobs-fair-yyc-1.3724949

#38 FRANK BURNS on 08.17.16 at 7:57 pm

Your right about the foreign buyers,Garth .Its our country, we made the cheap money available,foreign buyer just joined the party.Invited I must add.Thanks Garth for your honesty

#39 Freedom First on 08.17.16 at 8:04 pm

#7 Jimmy on 08.17.16 at 6:41 pm
“First!”
———————————————————–
You need to schedule a session with me.

#40 Smoking Man on 08.17.16 at 8:07 pm

#157 Metaxa on 08.17.16 at 5:05 pm

I may or may not be a millionaire but I sure do know a few…and not a one of them would spend any time at all on a financial/real estate blog telling other posters to shove a vibrator up their bum, as SM did up thread a bit.

I’ve tried it so I thought they might like it too.

#41 Vangordo on 08.17.16 at 8:07 pm

Should we not be lobbying for a 1% increase in prime interest rates to scare the bejesus out of ourselves?

#42 SAM on 08.17.16 at 8:08 pm

“So why did Frisco house prices increase by only 10% in 2015 and just 5% over the past 12 month period? H”

Because there are a lot more foreign buyers than 5%. Everyone here knows that, and either you don’t want to offend people, or you are clueless. There are numerous articles in the media about the extent of foreign purchases and about how many people from China are laundering their money through real estate. You just have to walk around many neighborhoods and see for yourself. The governments have encouraged this. It doesn’t take a rocket scientist to figure out that foreign ownership is driving the market in Vancouver. What else can explain the fact that real estate is massively higher in Vancouver than anywhere else in the country?

Just did. — Garth

#43 economictsunami on 08.17.16 at 8:08 pm

Ever wonder, would we have been better off if markets were less interfered with back in 2008/09.

We basically went from policies where markets were merely influenced, to direct interference. ( Lobby groups have their constituents to look after too.)

Where would we be right now if markets were to simply given room to properly function?…

#44 Apocalypse2016 on 08.17.16 at 8:10 pm

And the North Koreans now have the nukes and rockets and are ready to roll.

The Trump Shitnado is about to hit the fan.

Wildfires in USA are “0%” under control and will spread. More massive wildfires, the work of terrorists, are on the way.

The Canadian real estate bubble fantasy is coming crashing down.

Reports just out say global warming will cost the economy over $2 trillion by 2030.

If we make it that far…..

The Summer of Hell is still heating up.

#45 Bytor the Snow Dog on 08.17.16 at 8:10 pm

Hey Garth,

I’m wondering if you’re going to let butt hurt feminists brigade the comments section of this post too.

Toodles!

#46 Femdom Fist on 08.17.16 at 8:14 pm

Heh, howcum.

#47 Mark Zain on 08.17.16 at 8:14 pm

Hey, here are some charts for your blog post tomorrow:

http://globalnews.ca/news/2887766/data-is-the-metro-vancouver-real-estate-market-in-free-fall/

Hopefully, this will finally wake more people up. People need to see things visually to get it unfortunately, and at times it still wouldn’t be enough. Keep up the great work.

Always nice to see the MSM follow up on stories that first appeared on this blog. — Garth

#48 Dave on 08.17.16 at 8:19 pm

Re #27 Nat

You are right. No offence intended, but I’ve been in Vancouver for over 20 years and what else explains the fact that there are far more Asians there now than even 10-15 years ago?

#49 masterofthetelecaster on 08.17.16 at 8:19 pm

Mr. Garth sir
It’s a pretty exciting adventure for myself and my kids to be building a self directed balanced diversified investment portfolio as the core of ones wealth and I thank you for your part in the process but when can we cover the high risk high return stuff?
It may be the only chance I have for retirement at this stage of the game.
Thank you in advance

#50 Scott on 08.17.16 at 8:20 pm

24-Paulo,Have you ever heard of punctuation and sentence structure? Didn’t think so.

#51 crdt on 08.17.16 at 8:21 pm

Out here in Langley “for sale” signs are starting to share utility poles. Quite a few have 3 signs, some even 5. Its like festive decoration everywhere. Have not seen so many for sale signs in a while…

#52 PDX Canuck on 08.17.16 at 8:31 pm

At this point, the reasons for the bubble in YVR and YYZ are less important than what might cause it’s bursting:

-job loss (starting with realtors)
-interest rate hikes (starting in the US)

Either will cause the 6x income mortgage/HELOC lot to understand, first among us, why a home is a shelter…and not an investment.

PS. Anyone that thinks SFO and YVR are even remotely similar is as delusional as a Trump supporter who thinks the election is rigged.

#53 Smoking Man on 08.17.16 at 8:33 pm

North Carolina Teachers Ordered to Avoid Calling Students ‘boys and girls’

How can anyone not see Trump Winning in a landslide?

#54 BS on 08.17.16 at 8:50 pm

Either way, it’s over.

Yup, even the perma bull realtors I know admit it is over. The market has gone no bid. Once September hits and the worst ever August sales numbers are reported the masses will start to clue in. There will be a massive rush to the exits.

No bid + lots of desperate sellers = prices falling off a cliff. We could be down 50% by year end.

#55 Go to AA Smoking Man on 08.17.16 at 8:53 pm

#157 Metaxa on 08.17.16 at 5:05 pm

Give it up guys. Smokie said he is/was sorry.

BTW, the “treatment” he went to seek was a tall bottle of JD.

It’s done by now. Give it up.

I may or may not be a millionaire but I sure do know a few…and not a one of them would spend any time at all on a financial/real estate blog telling other posters to shove a vibrator up their bum, as SM did up thread a bit.

Those that like and support this man cant see the loathing he obviously has for himself. In the short time I have been posting here he has changed his persona, his voice at least twice.

His “attacks” on whoever he decides has slighted him get more and more venal, less and less articulate with each passing day.

Go to his narcissistic nightmare he calls a blog and read his Chapter One and ask yourself, does this man have an agent, a publisher…who would willingly pay to read more of that?

The man is having a long and drawn out episode of some magnitude and those who defend and egg him on are facilitating a medical issue.

He needs help, professional help. This isn’t a right/left thing at all, its clearly time for an intervention.

Offers of rape and suggestions of anal penetration are not signs of a properly functioning human.

And Smoking Man…you have it entirely backwards…we are number one, its the aliens who are desperately trying to catch up. Alcohol and cigarettes don’t get you to the true knowledge, peyote and LSD does.

Well said.

#56 Victor V on 08.17.16 at 8:57 pm

#2 Shawn

http://www.theglobeandmail.com/real-estate/the-market/californian-short-seller-targets-home-capital-group-canadian-real-estate/article25715455/

Mr. Cohodes wants to disabuse Bay Street of that notion. He insists he has no interest in betting broadly against the Canadian economy, or trying to short the big banks. “They’re well-run, they’re diversified and they’re too big to fail by the Canadian government,” he says.

Instead he is aiming his efforts at one company: Home Capital Group. The company, through its subsidiary Home Trust, has emerged as one of Canada’s largest alternative lenders, offering mortgages to borrowers who may have been turned down by major banks.

Home Capital first landed on Mr. Cohodes’s radar two years ago when celebrity hedge fund manager Steve Eisman told an investor conference he thought the company was one to watch for those looking to short the Canadian housing market.

#57 Smoking Man on 08.17.16 at 8:57 pm

Joe Biden

Welcome to Serbia
https://youtu.be/b860pqwOIos

To all portfolio managers. Time to start thinking about rebalance. Bet on a Trump Landslide.

#58 Jim on 08.17.16 at 8:58 pm

#2 ShawnG in TO
“who’s lending at 600%? they need to be shorted”

Isn’t that what Garth’s Greater Fool Fund/ETF or whatever specializes in?

Telling ya, gold mine!

#59 Jim on 08.17.16 at 9:01 pm

I would buy shares in Garth’s Greater Fool – Short CDN RE Index BetaPro Fund, would make a nice compliment to my BitCoin and Precious Metals/Rare Earths portfolio.

#60 X on 08.17.16 at 9:02 pm

So about a month from now Morneau is possibly going to makes some changes that could affect the RE markets… He really does need to do something to curb this lending (600% in the GTA should outright scare an intelligent individual) to protect the sheep from themselves. Yes, it is too late. Far too late. But make it right.

Perhaps Hudak can give him his honest opinion from his new position. Not that honestly helped him much in his last campaign. Or would help much in his new position.

#61 The American on 08.17.16 at 9:08 pm

At #13: Victoria Real Estate Update, my oh my. Where to begin? First, I am he person who posted the “vast majority of Americans do not wish to live in Florida or Arizona.” This statement is absolutely true. Yes, roughly 26,000,000 people occupy these two states, or only 7.8% of the U.S. population. Of those 26,000,000, many do not like it there due to extreme heat conditions. Yes, I can certainly understand why a Canadian would appreciate this condition. But as for the U.S., most Americans would agree there are significantly much more desirable areas to live in our land… and they do. On a final note, I’m not a realtor – not sure why you feel that way. All my point was is although your data is indeed accurate, try making more of an apples-to-apples comparison, meaning similar cities from the U.S. when comparing Canadian counterparts. It has better context in that respect.

#62 Go to AA Smoking Man on 08.17.16 at 9:24 pm

If your liver is failing, like you mentioned a while back, and you continue to drink, doesn’t that mean the bottle owns you and not the other way around?

#63 Context on 08.17.16 at 9:31 pm

JAPAN is Canada’s 4th largest export market which is up to date. The stats on Japan just came out and both imports and exports are crashing with big numbers so what does this mean as in 2015 we had a trade imbalance with Japan. Must go back to read this all.

#64 Victoria Real Estate Update on 08.17.16 at 9:35 pm

# 61 The American

You really don’t get it.

Try reading my entire post.

If a house in Canada in a small city in a dry area with cold winters is more expensive to live in with Canadian dollars than what Americans pay for houses in beach cities with warm winter weather in Florida, then that shouts out that Canadian housing prices are extremely overinflated.

What’s so difficult to understand about that?

Using this type of comparison makes an obvious point that you didn’t get.

#65 TurnerNation on 08.17.16 at 9:37 pm

Squarely blame this on stronger Canadian beer.

(And extra-plump squirrels)

#66 paulo on 08.17.16 at 9:42 pm

#36 kid you not
other than the fact that there is a long and good record at the first bank for family members 3 other siblings and the mom and dad no co-signer required ……

#67 IKnow on 08.17.16 at 9:44 pm

YVR is not San Fran, but is more conducive to HAM :

1. Canada is more lax about the reporting of world wide wealth, yes US has much tougher requirements. Source: a friend who is database manager at an international bank

2. Much higher density of ethnic Chinese in the city

3. Canadian pesos always look so cheap!

#68 Howelle Hedler on 08.17.16 at 9:55 pm

They can’t raise rates because if they do they pay more interest on the trillions they owe. (USA) Surprising this doesn’t get talked about more. What goes up (on fiat) must come down.

#69 Context on 08.17.16 at 9:57 pm

Back to Toronto as know nothing about Vancouver and here is why am afraid of this bubble because when it blows it will effect me, you, and everyone. This is not a traditional bubble as within a timeframe the capital loss and the spinoff damages created cannot be defined or calculated. We are seeing a volcano with untold hundreds of $billions which will disappear over a timeframe.

#70 fleabitten monkey on 08.17.16 at 10:02 pm

#47 Mark Zain/Garth’s comment – so when does Morrison from the Van Real Estate Board get taken to task, drawn and quartered and exposed as a fraud for promoting his scores of bullshit?
That guy should lose his position or he should step down.

#71 Smoking Man on 08.17.16 at 10:05 pm

#62 Go to AA Smoking Man on 08.17.16 at 9:24 pm
If your liver is failing, like you mentioned a while back, and you continue to drink, doesn’t that mean the bottle owns you and not the other way around?
….

Your right, thank you, lord Jesus for allowing Go to AA Smoking Man into my life. Halleluiah.

I’ll take the 12 step program so I can live to the end, so my kids can have the same fun I had watching my parents dither into nothingness while still breathing, confused and in pain.

You’re a god send. Thank you.

#72 Murphy on 08.17.16 at 10:19 pm

#61 American

Touchet! Victoria

Well written, well taken.

#73 ww1 on 08.17.16 at 10:21 pm

#44 Apocalypse2016 on 08.17.16 at 8:10 pm
If we make it that far….. The Summer of Hell is still heating up.

Heating up? It’s almost over (in a little over one month). And so far it’s been a pretty good summer overall – markets up, crazy real estate cooling, Drumph fading in the polls, not a lot of rain (unless you live in the deep south of the USA – oops). Pretty much normal on average I’d say.

I assume you will shortly be posting predictions about an “Autumn of Hell” followed by the “Winter of Hell”?

But I do actually have a question. Do you doomers get depressed when your predictions don’t happen? Or does your failure to predict perversely make you happy?

#74 Murphy on 08.17.16 at 10:22 pm

The final spurt before the inevitable slump..sounds like the market right now.

#75 DON on 08.17.16 at 10:26 pm

#84 Single RE Sales Observations… on 08.17.16 at 1:04 am

Tired of reading posts such as #48 DON about the SINGULAR real estate sale somehow indicating what is happening in the market as a whole.

Statistically, your observation is as significant as taking a leak in the Pacific Ocean and measuring the water level increase afterwards.

A rule of thumb for sample sizes is 30 minimum provided the data is normally distributed (a singular peak = average, just as many data points, and fewer, on either side of the peak, i.e., appears bell-shaped on a graph).

If it is not, you need a larger sample size > 30.

So please stop posting singular sales data, if it is even true, somehow thinking you are reporting on the market as a whole…you are not. And nor does 1 observation indicate a trend. To draw a straight line on a graph, you need 3 data points as a minimum, not just 1
**********************
What are you going on about? – my comment wasn’t even about trends – I simply stated it appears that condo’s are still selling as they are currently within most Vancouverites inflated budget…being under a million dollars and all.

And don’t you pull the school thing on me…I took the course you are referring to and even a sample of 30 with three data points is not sufficient if the questions are not properly worded or the sample of people is not chosen in a random manner. Plus the kicker is understanding the current context and market sentiment.

Do you believe your realtor when he she states that prices are bound to go up forever?

Me thinks you need to listen more to sensible folks rather than the feel good stats your beloved Realtors provide. All bubbles burst sooner of later, and it really doesn’t matter when it is inevitable.

If you have too much skin in the game for your comfort level – get out!

#76 Russ on 08.17.16 at 10:30 pm

Go to AA Smoking Man on 08.17.16 at 8:53 pm

#157 Metaxa on 08.17.16 at 5:05 pm

Give it up guys. Smokie said he is/was sorry.

BTW, the “treatment” he went to seek was a tall bottle of JD.

It’s done by now. Give it up.

—————————–

Well said.

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

Got that right. I would say it again but twice is enough.

Cheers to all.

#77 WUL on 08.17.16 at 10:31 pm

The GOP picks Trump. Cements a Clinton win.

The Ont. P.C.’s go with Hudak. Cements a win for Wynne. Brown will have the same result.

The Righties in AB pick either Jason Kenney or Brian Jean (and the knives are being sharpened). Will cement a second term for Ms. Notley.

Up your game Righties. The world has moved beyond men in navy blue suits with red ties blathering on about fiscal prudence. Why can’t you spot the trend?

#78 Snowboid on 08.17.16 at 10:43 pm

61 The American on 08.17.16 at 9:08 pm…

I’ve been to almost all the US states, and the favourites are Hawaii, California, and Arizona.

I don’t like heat and humidity combined so most of the eastern US is out, but Arizona is dry heat. I’ve always loved the desert, having worked down there in the early 1970s – it was a first choice for our winter home.

Of course, recent surveys have placed seven Florida and Arizona cities in the top ten best places to retire – we can’t argue as our AZ city is one of them!

While some of the cities in AZ that VREU uses may not compare to Vancouver or Toronto the examples today of smaller centres south of Phoenix are a perfect comparison to Moose Jaw – the only difference is the winter is unbearable in MJ where the summer is down south.

I’ve said this before, but it is worth repeating – our AZ home is currently worth a tad over $ 300,000 CAD, while comparable homes in Kelowna, BC are currently listed in the area of $ 550-600,000. This clearly indicates the point VREU is making also applies to a more apple to apple comparison!

While you may be correct that many folks don’t like the summer heat in Phoenix, there is a lot of US folks still moving there.

In fact Phoenix is in the top ten US cities with the fastest growing population.

#79 Context on 08.17.16 at 10:46 pm

Smoking Man needs to change his eating habits and all will be well. I wear glasses and cannot see out of my right eye anymore as all is blurry, but when I take off my glasses the right eye is now 20/20. The left eye has a small correction to be made but for now am screwed. I got rid of a lot of junk food and am buying mainly products from Poland which are pure like hot mustard, rye bread, jams, Ukrainian salad, sauerkraut, green tea, kielbasa, mayonnaise, garlic dill pickles, 90% chocolate, pure honey, and the list is long.

#80 Apocalypse2016 on 08.17.16 at 10:47 pm

Things are heating up in real time.

Barbaric Brazilians not only booed the French silver medal winner, but their thug cops have pulled Americans off a plane home!

See as well the full extent of the threat now posed by North Korea.

http://www.cnn.com/

Rio and Brazil will descend into chaos within hours of the Olympics closing. Those empty seats presage economic disaster, and the leaders are about to be ousted, or worse. People are beseiged by bugs there today, and Zika is everywhere.

This basket of contagions will spread across South America and Mexico, all of which are in dire straits in so many ways.

#81 Smoking Man on 08.17.16 at 10:50 pm

Star Man is on his head in the back yard thinking.

Where is home.

#82 PDX Canuck on 08.17.16 at 10:52 pm

@#56. Garth has a CDN short RE fund?

#83 Smoking Man on 08.17.16 at 10:52 pm

My autism strikes again.

https://youtu.be/RpLw8VW-R7I

#84 Les Brannerman on 08.17.16 at 11:03 pm

Read in the paper Winnipeg is expected to grow to 1 million people by 2035. How do I play this long housing in Winnipeg strategy? I have 21 years to retirement.

#85 A Canadian Abroad on 08.17.16 at 11:09 pm

ANSWER: So why did Frisco house prices increase by only 10% in 2015 and just 5% over the past 12 month period?” – Garth

Because the USA has a tax on ANY property that is over $300,000 (married) IF you are a resident. Non-resident? GAINS ARE TAXED AT FULL INCOME.

How do I know? I had a 2300 sq/ft rancher in Texas last year we sold.

As far as I know, only Vancouver has anything like that in existence in Canada.

#86 Victoria Real Estate Update on 08.17.16 at 11:09 pm

“The “vast majority of Americans do not wish to live in Florida or Arizona”. This statement is absolutely true. ”

This statement is laughable.

The same can be said about any American state or any two American states.

For example:

California population: 39 million

New York (state) population: 20 million

Total: 59 million, which is only about 18% of the total population of the US.

Using your line of thinking, the vast majority of Americans do not want to live in California or New York.

This statement is absolutely true.

I could use any two states and the statement would be absolutely true.

So what’s your point about Florida and Arizona? That’s right, you don’t have a point.

If you’re going to make statements and claims to argue against what I write, then you should at least have information that’s accurate, believable and that can be verified.

#87 BS on 08.17.16 at 11:10 pm

#47 Mark Zain on 08.17.16 at 8:14 pm
Hey, here are some charts for your blog post tomorrow:

http://globalnews.ca/news/2887766/data-is-the-metro-vancouver-real-estate-market-in-free-fall/

Hopefully, this will finally wake more people up. People need to see things visually to get it unfortunately, and at times it still wouldn’t be enough. Keep up the great work.

From the article headline;

Is the Metro Vancouver real estate market in free fall?

Yes it is. How the headlines have changed over the last month. I guess with these numbers “free fall” is the only way to describe it.

According to the website, the City of Vancouver currently has an average home price of $1.1 million, down 20.7 per cent over the last 28 days and down 24.5 per cent over the last three months…

Zolo CEO Barry Allen says the market in Richmond has “gone off a cliff” with the average home now priced at $779,000, down 20.7 per cent from three months ago and 17.6 per cent from last month.

Oops sorry “off a cliff” is a valid way to describe it as well.

What causes prices to lower is “urgency, anxiety, and fear,” according Eilers. He says a climate of financial overexposure, a treadmill of buying and selling and flipping homes, owning multiple properties, and buying before selling will test how long sellers can hold on without selling in desperation.

He points to the 1980 housing crash that dropped prices by 40 to 60 per cent within a year and took six years to recover.

“So your $2 million house became $800,000 in five months. There’s a lot of economists and a lot of wise people that believe that our financial structure is much closer to that structure from a corrections’ point of view,” Eilers explained.

Wow, even realtors are predicting a 40% to 60% crash within 5 months. This is going to be fun to watch.

#88 Bob Loblaw on 08.17.16 at 11:11 pm

The quote from the National Bank of Canada in this article says that 1/3 of Vancouver homes were purchased from buyers in China in 2015. That’s way more than the 5-10% that Garth has been saying.

Remember that the study the liberals did was only a few week sample and didn’t even capture sales from the end of the month, let alone a full year. Nor did it capture sales to proxy buyers that have resident status, like that one UBC student that was the registered buyer of a $30M+ mansion.

http://globalnews.ca/news/2887766/data-is-the-metro-vancouver-real-estate-market-in-free-fall/

Wrong. That is a quote from a Chinese web site incorrectly quoting the bank. There is no data to support the claim. — Garth

#89 Jr on 08.17.16 at 11:47 pm

Good work on chapter 1 smoking man. Put me down for 1 copy when published. I think it’s good enough to make Operah’s reading list. And you know what that means, if it’s on her list, it’s on Obamah’s list too!
:)

#90 BOOM! on 08.17.16 at 11:57 pm

It’s over?

Did the Fat lady sing? Ah, I missed it. Well, now we can see how getting ‘pickled’ in debt works out for the country.

I gotta say, it hasn’t worked out so well for Ireland, Iceland, Latvia, or Greece.

Maybe Canada will have better results?

#91 Tony on 08.17.16 at 11:57 pm

Re: #8 anon on 08.17.16 at 6:44 pm

Unless you try to sell on mls and find out prices are really down about 25 percent since the November 2014 peak in Calgary. Prices in Fort McMurray are down more than 50 percent since the peak around November 2014.

#92 Tony on 08.18.16 at 12:02 am

Foreigners who pay too much for a house are 100 percent responsible for the absurd prices for homes in Canada. The clueless Millennials in Canada copy what the Chinese do whereas in America none of the Millennials copy what the Chinese do. That’s where the big difference lies. Canadians should look at the track record of the Chinese when it comes to investing. Buying high and trying to sell higher or chasing everything which is what the Chinese do when it comes to investing in everything produces the greatest losses possible.

#93 Metaxa on 08.18.16 at 12:29 am

#77 WUL

The GOP picks Trump. Cements a Clinton win.

The Ont. P.C.’s go with Hudak. Cements a win for Wynne. Brown will have the same result.

The Righties in AB pick either Jason Kenney or Brian Jean (and the knives are being sharpened). Will cement a second term for Ms. Notley.

Up your game Righties. The world has moved beyond men in navy blue suits with red ties blathering on about fiscal prudence. Why can’t you spot the trend?

Man I wish I could sit across the table and slam a few wobbly pops! And talk, I bet we could fix this mess, eh?

As a life long dues paying, card carrying Progressive Conservative…this is what I’ve been rattling on about for years.

I stopped any form of support when Peter sold out to Harper and stood by taking helicopter rides and dating beautiful women as the neo-liberal policy wonk proceeded to gut whatever remained of true, classic conservatism out of the party.

Its too bad that nationalism and near fascism has replaced true conservatism…world wide if you bother to look.

#94 Simple on 08.18.16 at 12:35 am

So why is it, with far fewer foreign dollars flowing into YVR or the GTA than major US cities, we have gasbag markets, rampant house horniness and excessive price increases? Could it (gasp) be us?

————————

Simple.

The US has way tougher anti-laundering laws and investor immigrant programs that require you to have more money and actually put your capital in productive businesses – not houses.

Those cities did not bring in 200,000 investor immigrants like Vancouver did under the 32 years of the federal investor immigrant program program (which while defunct, Vancouver still benefits from the 5000 that go to Quebec and then flee to Vancouver).

Those cities have a federal government that enforces their anti-money laundering laws unlike here where we don’t even enforce FINTRAC.

Those cities have a federal government that requires declaration of worldwide income without the escape hatches that our’s has which permits astronaut families that apparently live at the poverty line in their million dollar homes. This is in contrast to our lovely nation, in which the CRA has only done one global income audit in recent years.

The list goes one – but in essence, our environment is so much easier to invest in using legitimate or illegitimate capital.

We are very naïve when it comes to global affairs thinking that everyone wants to be a contributing Canadian and will play nice and by the rules. Unfortunately, 95% of the world comes from a dog eat dog environment where they get rewarded for circumventing the system.

#95 Londoner on 08.18.16 at 12:44 am

Hi, haven’t posted here in a while. I’m actually visiting Canada right and staying in NOTL. I could have sworn I saw you enjoying some ice cream this evening on Queen St. Was that you? If it was then I hope you’re enjoying the area like we are. Cheers.

#96 Randyman on 08.18.16 at 1:04 am

I must say, I might agree with you on this one as the market is overheated in some cities in Canada and is due for a correction. After all, I must commend you in your book 2015 After The Boom when you said and I quote, “It just doesn’t make sense anymore to tie up $200,000 or $500,000 of your money in a residence…….Will your house ever double in value-even in a ten year period–during your life? NO, in fact it will not. You will be exceptionally lucky to bail out during the next five years with your initial investment…..” page 99, problem, this was written in 1995. And May 30, 2008 in the Financial Post you wrote ““We are classically at the end of a bull market,” How has this worked out for those that got out? I guess if I wake up everyday and say an earthquake is going to hit Vancouver today, I might get it right……eventually. All kidding aside, I must say I have taken your advice and kept all my mortgages variable and you were right on that one. But when it comes to dispelling accurate RE predictions about the future, perhaps your track record might indicate we leave that up to someone else.

#97 Mountain Dew on 08.18.16 at 1:05 am

I went to an open house in Kitsilano for a two bedroom 32-year-old town home listed for $749K, that would bring tears to the eyes. The open house was in the middle of the day on a Wednesday, and was well attended. The place was in very rough shape. Holes in the walls; dirty, stained ancient carpets; moldy smell throughout. No updates, ever, it would seem to the kitchen or bathrooms, or anything else. With a 5% downpayment, the mortgage would be well north of 3K a month — and it needs tens of thousands in repairs and updates to make it livable. This is what is has come to in Vancouver — speculators and desperate couples circling an “affordable” wreck. It’s just tragic.

#98 mouldyinYVR on 08.18.16 at 1:14 am

http://www.stuff.co.nz/business/opinion-analysis/83276937/bruce-tichbon-most-of-us-love-this-property-bubble
Thank gawde…..we are not alone…….the Kiwis have the same disease!

When the bubble pops in New Zealand it will be “the fault of those greedy property investors, immigrants, Chinese bankers, fat cat landlords, the Resource Management Act, and those young Kiwi mums and dads who just wanted a half decent home to raise their kids in and had to take on a massive mortgage to do it.

The politicians have the means and the power to recognise and fix the (real estate) inflation problem. They won’t act because (real estate) inflation is deeply ingrained in our national psyche, it appears to create wealth out of thin air and any politician that stops that illusion will not win the next election.
So the (real estate) inflation fantasy just goes on. Inflation, driven by governments printing too much money and not moderating their property markets is part of western democracy now; surely its Achilles heel.”

Sound familiar? It should.

#99 #10 JO Love it... on 08.18.16 at 1:23 am

Well written. Corrections are good for economy, they get rid of bad players. Unfortunately still many in the banking system lingering from 2009 (too big to fail).

#100 no bid on 08.18.16 at 1:25 am

Garth,
I didn’t believe it but couple of realtors told me that since 2015 more than 20% of sfh market in yvr was ham, and that has changed in April 2016. Right now SFH market is dead, I mean really dead, only millennial are bidding downtown condos. The numbers are not looking good at all, if the pace of last 3 weeks continue, we will see a 10-20%correction by year end.
BTW you were right, market turned, sale mix changed in march/April.

#101 Sorry #75 DON on 08.18.16 at 1:34 am

Actually, got out of the game last year and living comfortably in Italy (ret.). Knew what is happening now in YVR RE would hit the fan, Feb/Mar…don’t ask how (Ross Kay not the only one that saw this coming beforehand – and yes, wrote to former colleague’s documenting the fact at the time…witnesses a good thing).

Stats Don is because we get many Realtor postings here trying to turn opinion with disinformation, as you know. Just my way of using some Stats 0001 to disavow what they say with their singular observations that somehow they believe will turn opinion towards their way of thinking but does not hold any water. MLS averages, means based, seasonal adjustments all based on stats, so a good thing to remind them of the error of their ways using their own methodologies.

You would be what the Economists call an “unintended consequence” having gotten caught in my crossfire at these individuals.

BTW, I believe we are headed for a deep job loss recession in Canada, most likely October/November. RE crashing will of course contribute to this but I believe also external shocks from China etc. will not help. It will be a rough ride into 2017.

#102 #54 BS yup...and GDP with it on 08.18.16 at 1:50 am

Well said and I agree on your numbers…I believe them to be very accurate for then, as Garth’s “greater fools” head for the exits.

The very bad thing is that the only major GDP growth sector left in Canada is RE et. al.

With that gone, GDP will start to go south (it is just beginning to) as will job creation (the latter which is already headed south with about 110,000 full time jobs lost in June/July replaced in part by McJobs and of course, the newly “self employed”).

If we are not in a severe job loss recession by Oct/Nov, then divine intervention will have occurred or one heck of a positive external shock. 2017 will be a rough ride.

Why I am holding off buying anything in the markets until this all plays out as recession data has to be factored into the markets. After that is over with, then a good time to buy.

Yes Garth shoot me, the markets will have to correct first if we have a recession late this fall…after, a good time to buy.

No magical market timing, just common sense.

#103 Satyam Patel on 08.18.16 at 2:01 am

What’s your take on commercial real estate? Is it subject to the same overleverage as the residential market or have the regulations put in a few years back made it more stable?
If Vancouver is fundamentally overpriced in residential real estate are multimillion dollar commercial locations about to be collapsing in value as well? (They have had extremely low cap rates for at least a decade)
What implications does this have for reits which you have previously advocated holding?

#104 NoName on 08.18.16 at 2:38 am

oh the horror…

“Project managers are now openly providing drugs to construction workers so that they will work faster,” a construction source in Pyongyang told Radio Free Asia.

http://www.telegraph.co.uk/news/2016/08/10/north-korea-feeding-workers-crystal-meth-to-speed-up-skyscraper/

#105 DON on 08.18.16 at 2:45 am

#47 Mark Zain on 08.17.16 at 8:14 pm

Hey, here are some charts for your blog post tomorrow:

http://globalnews.ca/news/2887766/data-is-the-metro-vancouver-real-estate-market-in-free-fall/

Hopefully, this will finally wake more people up. People need to see things visually to get it unfortunately, and at times it still wouldn’t be enough. Keep up the great work.

Always nice to see the MSM follow up on stories that first appeared on this blog. — Garth
**************

Was on the phone chatting with a friend tonight, a news thread came across his phone and he said Vancouver sales are down 96% – I said nooooo! I didn’t think I would ever hear this in the MSM, and this has been happening since March, way before the tax. Surely the tax stopped the high end sales or at least a critical mass of them.

Yet, one of the first comments ensured people that this is only a temporary lull. Now the housing bulls don’t even believe the MSM.

#106 some wisdom here on 08.18.16 at 3:41 am

#57 SM

“To all portfolio managers. Time to start thinking about rebalance. Bet on a Trump Landslide.”

Your calls here have been good with regards to US rates, currency and economy. Markets are neglecting a possible Trump win and a new era of US Finance.

Would agree with you that Trump is probably winning the election and the hype around him will die down as soon as he’s sworn in. Hillary is setup to fail. Trump wouldn’t have run again if he didn’t think he could take on the Clintonistas and their minions in every level of DC government. The people DO NOT want another Clinton and they feel that Trump is the one to clean house in DC which is long overdue. Trump’s allegation the election may be rigged has merit. Everything inside the DNC was already rigged towards HRC and the Clintons have a considerable grip on every level of DC staffing.

Everything is still toppy across all markets. Valuations don’t make sense and when the only rationale touted by financial talking heads is that “there is nowhere else to put the money”.. it’s pretty obvious that the end of the game is near.

It’s an election year and the administration is changing either way. That alone is historically always a good reason to rebalance.

#107 Syd Cixe on 08.18.16 at 4:31 am

A giant banner on the side of a 25 plus storey condo building in the west end of Toronto reads, “MOVE IN NOW.” It might as well read – because it is implicitly acknowledging – “THERE’S A GLUT OF CONDOS IN TORONTO.” Why, then, are even more condo buildings under construction? Can’t the developers see the financial disaster that they are creating for themselves?

#108 Zen Headspace on 08.18.16 at 5:21 am

We have only ourselves to blame.

#109 Venal Degger on 08.18.16 at 6:18 am

The Justin Trudeau Economic Plan has thousands of Albertans lining up for minimum wage jobs at the airport.

http://calgaryherald.com/category/business/local-business

Way to go Junior, better we have people on social assistance than let any of that dirty oil come to the surface and create real wealth.

I’m having to remind myself that our PM never held a job above babysitter.

#110 Herb on 08.18.16 at 7:15 am

#109 Venal Degger,

ah, another of our daily contribution by the CPC Silly Names Blogging Brigade.

Disgusting – and I don’t mean Trudeau!

#111 Go to AA Smoking Man on 08.18.16 at 7:25 am

#71 Smoking Man on 08.17.16 at 10:05 pm

#62 Go to AA Smoking Man on 08.17.16 at 9:24 pm
If your liver is failing, like you mentioned a while back, and you continue to drink, doesn’t that mean the bottle owns you and not the other way around?
….

Your right, thank you, lord Jesus for allowing Go to AA Smoking Man into my life. Halleluiah.

I’ll take the 12 step program so I can live to the end, so my kids can have the same fun I had watching my parents dither into nothingness while still breathing, confused and in pain.

You’re a god send. Thank you.

—–

A little sober thought, refreshing. Driving yourself into the grave so your children don’t have to watch you die the way you watched you father die…correct?

An alcoholic, or an addict of any kind, is a dead man walking. You’re not living. You are a walking breathing dead man. You had the benefit of knowing your father, who by your accounts, you truly loved and you admired.

The equivalent would be a marriage where the couple is physically together but emotionally divorced.

You are divorced from your life, from reality, and you use booze as a means to run from what’s hurting, which means you only delay dealing with the root problem.

#112 Go to AA Smoking Man on 08.18.16 at 7:45 am

#76 Russ on 08.17.16 at 10:30 pm

Go to AA Smoking Man on 08.17.16 at 8:53 pm

#157 Metaxa on 08.17.16 at 5:05 pm

Give it up guys. Smokie said he is/was sorry.

BTW, the “treatment” he went to seek was a tall bottle of JD.

It’s done by now. Give it up.

—————————–

Well said.

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

Got that right. I would say it again but twice is enough.

Cheers to all.

—-

Are you an alcoholic too Russ? Of course, you don’t mind watching a guy blow his brains out in public, better you than him right?

#113 Mr. Frugal on 08.18.16 at 7:45 am

#57 Smoking Man on 08.17.16 at 8:57 pm
Joe Biden

Welcome to Serbia
https://youtu.be/b860pqwOIos

To all portfolio managers. Time to start thinking about rebalance. Bet on a Trump Landslide.
________________________________________

Agreed. Wall Street completed missed Brexit. When Trump wins, portfolio managers are going to run for the exit. This will be a golden buying opportunity. Buy fear and sell greed.

#114 Herb on 08.18.16 at 7:55 am

#94 Simple,

you’re right, it is simple.

Unfortunately we have allowed the political convenience of the ethnic vote to be turned into the political correctness that hogties us.

#115 Grantmi on 08.18.16 at 8:04 am

“If there is another plausible explanation for McCallum’s surprise “request” last week that Beijing allow the tripling of visa application centres in China with a view to radically boosting the number of Chinese students and temporary foreign workers in Canada, that explanation has not come from McCallum. All we’ve heard is the usual treacle about Canada’s openness to the world.”

Of course McCallum would…. 100%

#116 Rational Optimist on 08.18.16 at 8:07 am

I just read this mischaracterisation of your advice in CBC Business, Garth:

‘Their financial adviser Garth Turner backs that up. “They hoovered up every scrap of cash from every source and jammed them into their [stock] portfolio,” he wrote in a blog this week.’

That’s from an article about those two young globe-trotters we all love to hate: http://www.cbc.ca/news/business/kristy-shen-bryce-leung-1.3724450

If I had more energy, I’d write a strongly-worded letter telling Ms. Harris that, if she had bothered reading this blog every day religiously as any business journalist worth her salt should, she would know that the recommendation is that average folk stay away from stocks. The text inside of the brackets should have read “[balanced]” or, even better “[non-cowboy].”

Sign. The CBC has no ‘business’ journalists. And they don’t dig affectionate sarcasm. — Garth

#117 crowdedelevatorfartz on 08.18.16 at 9:01 am

@#44 Apocalypse 2016….17…..18…..19
“The Summer of Hell is still heating up.”
********************************************

I guess that has a bit more sex appeal than the “Winter of Hell” or the “Spring of Hell”……..doesnt really matter .
We’ll be hearing that inane sure fire “prediction” from you soon enough. Kinda like your apocalyptic Olympic predictions……still waiting for the Zika “skeeters” to arrive in Bung Hole Tickle, Newfoundland.

#118 Ace Goodheart on 08.18.16 at 9:43 am

RE: #13 Victoria Real Estate Update

Well we do know that quite a few Canadians DO want to live in Arizona and Florida. And with houses in these sunny, winter free states going for 150k, quite a few of them are living there, in the winter anyway…

#119 The American on 08.18.16 at 9:44 am

At #64: Victoria Real Estate Update, actually you aren’t getting it. Use similar cities to compare prices. If you want an accurate picture of what prices really are from country to country, stop picking hick places out of Florida and Arizona to compare with large metropolitan areas in Canada. There are plenty of dryer and warmer places in the U.S. that people would actually find DESIRABLE year round, as opposed to extremely hot and/or muggy places like Phoenix, Jacksonville, and Davenport. Seriously? Hell, I can go into Canada and find PLENTY of cheap homes also in areas that aren’t very cosmopolitan and/or backwater (believe me, I’ve done it). You lose credibility when apples-to-apples comparisons aren’t being used. Want to compare a price of a home in Vancouver to one in the U.S.? Then use Seattle or San Francisco. Toronto? Use New York. Calgary? Use Dallas. Shit, it isn’t that hard to understand. Using your “logic,” why not compare the price of a home in Vancouver to a price of a home in fucking Morocco? Dude, you need keep comparisons in CONTEXT, otherwise it isn’t a fair comparison whatsoever.

#120 The American on 08.18.16 at 9:53 am

VREU, If I used your “logic” to do pricing comparisons, I’ll just say the U.S. is overvalued because the price of a 1,000 sq. ft. NYC flat is $2,000,000 USD and the price of a 1,000 sq. ft. flat in Regina is $350,000 CAD. WOW! The U.S. is overpriced!

See, that doesn’t really work when you cherry pick data from metropolitan areas where there are JOBS and considered desirable locations and force rank them against backwater shitholes in another country. If you would just use data for like-cities, you’d make your point.

I’m not arguing that Canadian real estate isn’t overvalued. Clearly it is. But, to make your point solid, use a solid argument.

#121 The American on 08.18.16 at 10:05 am

VREU, America’s 10 Worst States to Live In – using science: https://www.roadsnacks.net/these-are-the-10-worst-states-in-america/

Lookie there. Florida #2, and Arizona #4. Sheeeeesh, big surprise!

Like I said, I get why a Canadian would like it in those shitholes. Most Americans do not.

#122 Johhny bOuwers on 08.18.16 at 10:08 am

Garth

That pic says everything about the decline of the Canadian male….I mean the country stands behind Kazakhastan in the Olympics and most of the medals have been won by the women. The country needs a little bit more Borat-style chutzpah and less T2 new age hippie-ism. I suggest you lead the charge to establish a new male zeitgeist. You can start by playing street hockey with the kids.

#123 WalMark of Sadkatoon on 08.18.16 at 10:22 am

Why am I posting from this province? Oh yeah the food is good. Cheerio

#124 Delinquency Rates UP - Report on 08.18.16 at 10:37 am

http://www.mortgagebrokernews.ca/news/equifax-releases-latest-countrywide-delinquency-stats-212338.aspx

#125 Johhny bOuwers on 08.18.16 at 10:40 am

#42 SAM on 08.17.16 at 8:08 pm
“So why did Frisco house prices increase by only 10% in 2015 and just 5% over the past 12 month period? H”

Because there are a lot more foreign buyers than 5%. Everyone here knows that, and either you don’t want to offend people, or you are clueless. … What else can explain the fact that real estate is massively higher in Vancouver than anywhere else in the country?

Just did. — Garth”

Garth this minister seems to contradict you as he implies that most immigrants are going to YVR and T-dot. He wants to spread the load to lovely places like Joe Batt’s Arm, Tuktoyuktuk and Punkeydoodles Corners, Ontario.
https://www.thestar.com/news/canada/2016/08/17/canada-wants-to-spread-chinese-immigrants-evenly-across-country-minister-says.html

Spread them out like peanut butter……should be interesting!

#126 bill on 08.18.16 at 10:42 am

#117 crowdedelevatorfartz on 08.18.16 at 9:01 am
no worries there …the black flies will eat them for breakfast!

#127 Herb on 08.18.16 at 10:55 am

#116 Rational Optimist,

I read that second puff piece about Garth’s poster people early this morning, but decided not to dignify it with further publicity or “hate” comments here.

Two minor things I noted –

1.) We have allowed ourselves to be trapped into classifying non- or disapproval as “hate”. Classifying disapproval as hateful sure turns off debate – which may be the whole idea

2.) The last sentence of the article is revealing, Shen cited as saying “”I’m reminded of the quote, ‘If you’re not pissing someone off, you probably aren’t doing anything important.'”

My humble apologies to Smoking Man: I’ve failed to note that what he was doing was important.

#128 pBrasseur on 08.18.16 at 11:06 am

Either way, it’s over. – Garth

Could be, but as Keynes once said «The market can stay irrational longer than you can stay solvent»

It’s only a question of time however. Canadians (under strong government/CMHC influence…) have massively made the wrong financial choices and so have foreign financials who think Canada is a safe haven.

It is not. This will all be sorted out, eventually.

#129 IHCTD9 on 08.18.16 at 11:11 am

#96 Randyman on 08.18.16 at 1:04 am
I must say, I might agree with you on this one as the market is overheated in some cities in Canada and is due for a correction. After all, I must commend you in your book 2015 After The Boom when you said and I quote, “It just doesn’t make sense anymore to tie up $200,000 or $500,000 of your money in a residence…….Will your house ever double in value-even in a ten year period–during your life? NO, in fact it will not. You will be exceptionally lucky to bail out during the next five years with your initial investment…..” page 99, problem, this was written in 1995. And May 30, 2008 in the Financial Post you wrote ““We are classically at the end of a bull market,” How has this worked out for those that got out? I guess if I wake up everyday and say an earthquake is going to hit Vancouver today, I might get it right……eventually. All kidding aside, I must say I have taken your advice and kept all my mortgages variable and you were right on that one. But when it comes to dispelling accurate RE predictions about the future, perhaps your track record might indicate we leave that up to someone else.
_________________________________________

Ahh, yes – another dork with the benefit of hindsight poking fun at GT for comments made 8-20+ years ago.

Ok Mr. Randyman, how about you make a couple forward looking statements so I can call you a dingbat a couple decades from now?

And while you’re at it, tell me who exactly called the GTA/YVR RE insanity correctly with their predictions in 08?

#130 CJBob on 08.18.16 at 11:16 am

#64 Victoria Real Estate Update on 08.17.16 at 9:35 pm

If a house in Canada in a small city in a dry area with cold winters is more expensive to live in with Canadian dollars than what Americans pay for houses in beach cities with warm winter weather in Florida, then that shouts out that Canadian housing prices are extremely overinflated.

What’s so difficult to understand about that?

Using this type of comparison makes an obvious point that you didn’t get.
_________________
Can you find me a nice condo in Indian Rocks Beach, FL on the water for a great price then? You cherry picked examples that aren’t anywhere near the beach.

Davenport, FL is in the middle of the state no where near beach front.

Palm Bay is a large area which COULD BE near the water, but the example you picked is 45 minutes inland.
____________________________
You’ve not once admitted confirmation bias or that you could be even partially wrong so I don’t expect it to happen now but the proof is in the google map

#131 For those about to flop... on 08.18.16 at 11:17 am

Not much going on so I will post this chart for those people who worry about the U.S,in the grand scheme of things they are doing o.k.

Also to the person arguing with Don,just want to point out that Don was responding to a post from Mountain Dew and as he pointed out and was not giving one sale analysis.

I am not commenting about Vancouver real estate this month as it s time to enjoy the weather ,so I have declared August as ” Don’t give a crap about Vancouver real estate” month.

That bitch will still be waiting for me in September…

M42BC

https://imgur.com/a/KqJJu

#132 IHCTD9 on 08.18.16 at 11:30 am

#109 Venal Degger on 08.18.16 at 6:18 am

I’m having to remind myself that our PM never held a job above babysitter.

____________________________________________

Or outside the public sector…

JT is a coat-tail riding, poseur, trough feeding, nitwit, momma’s boy. He’s the PM because Harper was a mean, mean guy – that’s it.

I expected no less from him, how could he ever do any better?

Trudeau: The short tempered elbow dropping elitist la-la land brat offspring of the worst PM our country has ever suffered under.

There never was any chance for success.

#133 Noel on 08.18.16 at 11:33 am

Ah the ol’ David Madani callback. Reliable?

“House prices vulnerable to swing in “animal spirits”
Canadian house prices have formed a bubble and are vulnerable to a sudden loss of investor confidence. As such, we continue to expect prices to fall substantially over the next few years, which will have significantly negative implications for the broader economy.

22 August, 2011”

https://www.capitaleconomics.com/canada-economics/canada-economics-weekly/house-prices-vulnerable-to-swing-in-animal-spirits/

#134 Noel on 08.18.16 at 11:35 am

23 February, 2011

Housing downturn to hit economy hard

Because Canada emerged from the global financial crisis largely unaffected, many Canadians now appear to believe that the economy is somehow invincible. This level of hubris is disconcerting when housing valuations have lost all touch with the fundamentals, driven up by a massive surge in household debt. We’ve seen this story played out in countless other countries and it never has a happy ending. The now inevitable downturn in the housing sector will severely constrain economic growth over the next couple of years, as consumption expands at a more muted pace and housing investment shrinks back towards a more normal size.

https://www.capitaleconomics.com/canada-economics/canada-economic-outlook/housing-downturn-to-hit-economy-hard/

#135 Noel on 08.18.16 at 11:37 am

13 March, 2013

Housing downturn gathering force

The downward trend in both existing home sales and housing starts indicates that the housing slowdown is unfortunately becoming more broad-based. As demand and supply imbalances intensify this year, the downward pressure on house prices will mount as well. All things considered, residential investment will become a sizeable drag on the economy as soon as the current quarter…

https://www.capitaleconomics.com/canada-economics/canada-economics-update/housing-downturn-gathering-force/

#136 IHCTD9 on 08.18.16 at 11:46 am

#122 Johhny bOuwers on 08.18.16 at 10:08 am
Garth

You can start by playing street hockey with the kids.

__________________________________________

Totally illegal.

Someone might get hurt/inconvenienced.

#137 Russ on 08.18.16 at 11:50 am

Go to AA Smoking Man on 08.18.16 at 7:45 am

Are you an alcoholic too Russ? Of course, you don’t mind watching a guy blow his brains out in public, better you than him right?
===========================

As I asked earlier, is this “Troll Weak” at greaterfool.ca ?

Well, Double A, we are a bunch of 1 percent’rs who gather here, tease each other and blather on about not much or nothing. You seem far too serious to join, so how about taking your little crusade some place it might be appreciated?

try this:
http://www.womenoffaith.com/blog/

Me? Thanks for asking. I’m going camping, it’s beautiful out there.

#138 Context on 08.18.16 at 11:58 am

#107 Syd Cixe :- They are not building condos at all but future apartment buildings getting ready for the rental rush.

#139 Poloz on 08.18.16 at 12:02 pm

Your analysis is wrong. You can’t compare US real estate with Canada. US has over 400,000,000 people. Investments by the Chinese there is a drop in the bucket. In Canada the Chinese make a huge difference because of lack of usable land.

Compare Canada with Japan where interest rates have been zero for over 20 years yet real estate is in depression. Why? Because they do not allow the Chinese to purchase their properties.

My comparison was expressed in percentage of total sales, not absolute numbers. You have no point. — Garth

#140 Kwang Jai Bo on 08.18.16 at 12:15 pm

DELETED

#141 CRA has failed us on 08.18.16 at 12:24 pm

We are really a banana republic (and i am not talking about the store chain)
http://www.scmp.com/news/world/united-states-canada/article/2005794/canada-tax-chiefs-knew-foreign-moneys-big-role?utm_source=&utm_medium=&utm_campaign=SCMPSocialNewsfeed

#142 chopstix on 08.18.16 at 12:26 pm

garth…read this today about vancouver, toronto and calgary heading some ‘top global cities’ liveability index.
…guess the opposers to your blog will point to things like this and say ‘see, this is why the RE won’t come crashing down: there is still such a desire to live here’…what is your op, please?
http://www.theglobeandmail.com/report-on-business/top-business-stories/vancouver-toronto-calgary-dominate-global-liveability-rankings/article31453085/

#143 Smoking Man on 08.18.16 at 12:27 pm

Clinton Foundation Documents Hacked. Here we go.

That will just be enough to Destroy Hillary’s campaign. Then again, the Obama’s selective Justice Department won’t press charges.

Hillary should step down, have Obama pardon her before Trump wins the big one.

#144 chopstix on 08.18.16 at 12:30 pm

i think in the end, Garth, once any correction happens, it will come down to our cheap dollar (who wouldn’t a 20-25% discount right off the bat vs the US dollar), our RE greed and low interest rates, alongside the inclusion of many foreigners seeking a safe haven here….not one, but 3 elements in the cocktail.

#145 Context on 08.18.16 at 12:33 pm

You cannot compare the costing of homes built in Arizona for example with most of Canada. The basic construction is completely different and materials used do not match. No basements in Arizona is the norm and that is just the beginning.

Who mentioned Arizona? — Garth

#146 For those about to flop... on 08.18.16 at 12:37 pm

#137 Russ on 08.18.16 at 11:50 am
Go to AA Smoking Man on 08.18.16 at 7:45 am

Are you an alcoholic too Russ? Of course, you don’t mind watching a guy blow his brains out in public, better you than him right?
===========================

As I asked earlier, is this “Troll Weak” at greaterfool.ca ?

Well, Double A, we are a bunch of 1 percent’rs who gather here, tease each other and blather on about not much or nothing. You seem far too serious to join, so how about taking your little crusade some place it might be appreciated?

try this:
http://www.womenoffaith.com/blog/

Me? Thanks for asking. I’m going camping, it’s beautiful out there.

//////////////////////////////
Enjoy your trip Russ

Being on this blog is good for the mind.

The occasional break from this blog and the Internet is good for the soul…

M42BC

#147 Blacksheep on 08.18.16 at 12:50 pm

Economist Intelligence Unit, livability study:

“Canada’s West Coast is in the international spotlight again as Vancouver has been ranked third most “livable city” in a new global survey of 140 cities.”

“Terrorism fears”

“The report also noted that liveability had “deteriorated” in 29 of the 140 cities surveyed over the last year. The most striking declines in livability scores were in Damascus, Syria and Kyiv, Ukraine, where ongoing civil wars have led to increased security concerns.”

“The overall decline was largely attributed to growing fears over terrorism. Ten cities in Western Europe experienced a decrease in liveability following the “violent acts of terrorism” in cities such as Paris and Brussels.”

“Escalation in hostilities in Libya have prompted a sharp decline in livability in Tripoli as the threat to stability from Islamic State continues to spread across the Middle East and North Africa,” the report noted.”

“Compounding the overall decline was civil unrest in many U.S. cities over the deaths of black people while in police custody, and heightened tensions in Eastern Europe and Asia.”

http://www.ctvnews.ca/canada/vancouver-calgary-toronto-among-world-s-5-most-livable-cities-1.3033775
—————————————–
“A CNBC report reads: “Looking to move to a new city? Try Australia or Canada.””

http://www.cnbc.com/2016/08/17/melbourne-vienna-vancouver-ranked-top-three-most-livable-cities-by-the-economist-intelligence-unit.html
—————————————-
Van & T.O. RE may soften temporarily, but those expecting a correction of any significance, are simply not paying attention to global events.

#148 Context on 08.18.16 at 12:54 pm

The bubble in Toronto had nothing to do with foreign money for the most part. The speculation came from the local citizens from various ethnic groups and the worst traditionally point to lawyers, real estate agents, and mortgage brokers who had skin in the game. Now we have the new generations afoot coming from families from the 1970’s and 1980’s who were in on the game and some made big money. I am sure they influenced them to get in there and buy a few properties.

#149 Ponzius Pilatus on 08.18.16 at 1:02 pm

Spreading out the immigrants:
Can see the headlines:
“Another Lambo breaks down in snowstorm on dirt road near Moose Jaw”.

#150 Ponzius Pilatus on 08.18.16 at 1:07 pm

#145 Context on 08.18.16 at 12:33 pm
You cannot compare the costing of homes built in Arizona for example with most of Canada. The basic construction is completely different and materials used do not match. No basements in Arizona is the norm and that is just the beginning.
—————
No basements in Richmond either.
It’s on a floodplain. Still average price is close to 1.5 mill.

#151 Herb on 08.18.16 at 1:17 pm

#132 IHCTD9,

… offspring of the worst PM our country has ever suffered under.

How shocking! I had no idea that Trudeau was Harper’s offspring.

#152 NoName on 08.18.16 at 1:22 pm

off topic

funny thing brain is…

http://qz.com/757516/paraplegics-are-learning-to-walk-again-with-virtual-reality/

#153 Russ on 08.18.16 at 1:40 pm

For those about to flop… on 08.18.16 at 12:37 pm

Enjoy your trip Russ

Being on this blog is good for the mind.

The occasional break from this blog and the Internet is good for the soul…

M42BC
==========================

Thanks Flopper,

The break will be good. Plenty of negative ions in the forest and coming off the waters of the breezy Sailish Sea.
They probably should have named it the Motorish Sea, that’s the view most days. :)

A wee forecast for my absence: the Olympics will end, markets will have moved, people will complain and the sun will shine (but not everywhere).

#154 james on 08.18.16 at 1:48 pm

#121 james on 08.17.16 at 11:44 am

My guess Trump will through Manafort under the bus, just like he did with Corey Lewandowski. Lewandowski remains subject to a non-disclosure agreement that he signed with Trump, forbidding him “from making disparaging or revealing remarks about the candidate. Lewandowski receives severance pay from the Trump campaign while working for CNN.

http://www.nytimes.com/video/world/europe/100000004593100/ukrainian-official-discusses-manafort-and-secret-ledger.html?mabReward=A3&moduleDetail=recommendations-1&action=click&contentCollection=Politics&region=Footer&module=WhatsNext&version=WhatsNext&contentID=WhatsNext&src=recg&pgtype=article
…………………………………………………………………
Annnnnnnd what do you know, Manafort out this morning. Thrown under the bus. Side-lined to what? Campaign chairman? Kellyanne Conway is what? The Campaing Manager? What the hell are these idiots trying to do here. Its like getting everybody on the Titanic to move all the people on the left side of the ship to the right and visa versa. I got news for you guys, your going down no matter what.
http://www.cnn.com/2016/08/18/politics/donald-trump-shakeup-gamble/index.html

#155 Context on 08.18.16 at 1:58 pm

There have been historic bubbles in Toronto during the 1970’s and 1980’s, but at this time there were very few high rise condos or townhouse projects. Flipping properties and speculation buying took place with some holding up to 50 but most held 3 including the principal residence. Now if one looks at the historic average home prices during the 1970’s and 1980’s in Toronto one cannot see any material change.

The real rock and roll in prices was during 1991 to 1996 where a real bottom was firmed at $198,150 for the average home price in the City of Toronto and it went straight up to 2016. This is the date when the condo towers began to dot the skyline transforming the city from traditional housing types to condo city. Now we have before us a real bubble and when it blows the destructive force of this volcano will rock the nation into a state of utter panic.

#156 james on 08.18.16 at 2:02 pm

#143 Smoking Man on 08.18.16 at 12:27 pm

Clinton Foundation Documents Hacked. Here we go.

That will just be enough to Destroy Hillary’s campaign. Then again, the Obama’s selective Justice Department won’t press charges.

Hillary should step down, have Obama pardon her before Trump wins the big one.
…………………………………………………………………..
I don’t think so buddy, your best friend is deeply and covertly connected to the Russians. There is absolutely no way a Russian connected Trump will ever set foot in the White House.
Don’t fool yourself Manafort and Trump are deeply tied to Russian interests, investments and connections. His daughter just sighted vacationing with Premier Putin’s girlfriend.

http://www.bloomberg.com/news/articles/2016-06-22/clinton-foundation-said-to-be-breached-by-russian-hackers

http://www.theblaze.com/stories/2016/08/16/internet-explodes-after-ivanka-trump-posts-vacation-pic-with-vladimir-putins-reported-girlfriend/

http://www.nytimes.com/video/world/europe/100000004593100/ukrainian-official-discusses-manafort-and-secret-ledger.html?mabReward=A3&moduleDetail=recommendations-1&action=click&contentCollection=Politics&region=Footer&module=WhatsNext&version=WhatsNext&contentID=WhatsNext&src=recg&pgtype=article

#157 jess on 08.18.16 at 2:05 pm

prison reits
Corrections Corp. of America and GEO Group Inc., two real estate investment trusts that operate prisons for the federal government and other clients, plunged after the U.S. Justice Department announced plans to stop using private correctional facilities.

#158 bark on 08.18.16 at 2:18 pm

Lowered interest rates account for an inflated housing market in general, but what accounts for Vancouver houses being priced way above every other inflated housing market in Canada? It’s Chinese money, whether the real estate is own by Chinese nationals or owned by Chinese Canadians. The root cause is Chinese money.

#159 jess on 08.18.16 at 2:22 pm

“The goal: to replace Uber’s more than 1million human drivers with robot drivers—as quickly as possible.”
http://www.bloomberg.com/news/features/2016-08-18/uber-s-first-self-driving-fleet-arrives-in-pittsburgh-this-month-is06r7on

http://www.therecord.com/news-story/6814115-waterloo-region-says-no-to-in-car-cameras-for-uber-taxis-as-it-wrangles-with-proposed-bylaw/

#160 Who luvs ya baby on 08.18.16 at 2:25 pm

#143 Smoking Man on 08.18.16 at 12:27 pm
Clinton Foundation Documents Hacked. Here we go.

That will just be enough to Destroy Hillary’s campaign. Then again, the Obama’s selective Justice Department won’t press charges.

Hillary should step down, have Obama pardon her before Trump wins the big one.

#144 chopstix on 08.18.16 at 12:30 pm


Old news. Face it dude your future is cleaning
Garths toilets. Bet is In the archives. You and your hero are going down hard. He’s doubled down on being a retard.

#161 A Canadian in the U.K on 08.18.16 at 2:31 pm

They’re just as nuts about real estate in the U.K.
It’s the mirror image.

#162 Newcomer on 08.18.16 at 2:40 pm

I find it odd that people cite examples of the top being called earlier as arguments in favor of bullish positions. If Canadian RE was overvalued in the past, but did not go down, that is not an indicator that it will continue to go up. It is an indicator that, when it drops, it will drop far. There is no rational ceiling in a bubble, but there is a rational floor when it bursts. Think of all of those previous top calls as elevator-stops that we passed on our trip up from the ground floor.

#163 jess on 08.18.16 at 2:44 pm

…”Historically, Canadians have been very prudent borrowers, and the best evidence of this is the mortgage-in-arrears statistics in Canada, which track the number of households that have not made mortgage payments in three or more months.

“Less than half of one per cent of all mortgage holders with the country’s largest banks are ninety days in arrears. This number has been stable for more than two decades, in times of high and low unemployment, high and low interest rates, and a strong or weak Canadian dollar”
http://www.cba.ca/contents/files/statistics/stat_mortgage_db050_en.pdf

Includes data fromBMO, CIBC, HSBC Bank Canada, National Bank of Canada, RBC Royal Bank, Scotiabank, and TD Canada Trust.Canadian Western Bank, Manulife Bank (as of April 2004) and Laurentian Bank (as of October 2010)
Mortgage arrears is three or more months arrears in ontario over 12month period

ontario
2003- ~ 60 thousand
1996- 67,394
2016-04month / Number of Mortgages 1,971,584 / Mortgages in Arrears 2,733 / % of Arrears – 0.14%

#164 Context on 08.18.16 at 2:59 pm

#150 Ponzius :- Well that tells a lot about the people in Richmond does it not. I know this attorney in Mexico and told him not to buy his home as pointed out the numerous problems with it especially the goat field across the street. During the rainy season his street turns into a river because its in a flood plain, and he needs to buy a boat. Beside his home there is a huge communications tower, and he says so what as always wanted my own Effiel Tower to remind me of my days in Paris.

#165 TurnerNation on 08.18.16 at 3:07 pm

Old-mannish non sequiturs olololol.

#166 bdwy sktrn on 08.18.16 at 3:10 pm

They’re just as nuts about real estate in the U.K.
——————————
where in the uk – yorkshire? birmingham? scotland? – all dirt cheap

only london – where, like the 604, it is a magnet for global cash

#167 IHCTD9 on 08.18.16 at 3:24 pm

#151 Herb on 08.18.16 at 1:17 pm
#132 IHCTD9,

… offspring of the worst PM our country has ever suffered under.

How shocking! I had no idea that Trudeau was Harper’s offspring.
________________________________________

Come on Herbie – I said WORST PM, not best :).

Harper deficit after 9 years – 941 million Oct 2015
Trudeau deficit after 5 months- 30 BILLION March 2016

But, tell me how mean Harper was, he was soooo mean!

#168 @158 Bark on 08.18.16 at 3:58 pm

Don’t bark too loud. Or else CRa will be hounding you.

Some truths are best to remain buried. This is way bigger than you think. Protect you family. Whisper.

#169 Victoria Real Estate Update on 08.18.16 at 4:00 pm

# 130 CjBob

Cherry picked? Lol

Are you saying Moose Jae is beach front? I provided other examples of houses in Florida that are beach front cities. That makes my statement 100% valid.

Your comment is laughable.

I’m 100% correct. My examples back what I wrote.

Some realtors don’t know how to read. Now go lie to some more clients to make a sale.

#170 Victoria Real Estate Update on 08.18.16 at 4:08 pm

# 121 The American

Read my comments again along with those posted by Snowbird. Your line of thinking is ridiculous. The more you write the worse it gets for you.

Americans love Florida and Arizona. Many American and Canadian athletes and celebrities choose to live in those two states when they could live anywhere they want.

Again most Americans don’t live in any one or two states and that includes all 50.

More posts with American houses on the way since you are having such a big problem getting the rather elementary point of them.

Perhaps it will become a regular subject of some of my posts.

#171 Victor V on 08.18.16 at 4:12 pm

CMHC gave Maple Bank green light shortly before banking watchdog seized bank’s assets

http://business.financialpost.com/news/fp-street/cmhc-gave-maple-bank-green-light-shortly-before-banking-watchdog-seized-banks-assets

The insolvency of Maple Bank GmbH also prompted CMHC to undertake a review of another issuer, according to the documents, although the entity’s name is redacted.

When asked for more details on that review, CMHC said it “regularly reviews all issuers and assesses any events that may impact them.”

The federal agency declined to identify the entity under review or provide any further details.

#172 Context on 08.18.16 at 4:13 pm

Harper was never a PM but some Peter Pan character living in Neverland and the world laughed at this joker believing he was a King of economics. Harper needed to grow a pair but was all mouth. He rigged the books creating reality by manipulating the mortgage market with all the spinoffs thus boosting a false economy based on debt. What we see today was his making and the court of buffoons who assisted him – all traitors!

#173 Rexx Rock on 08.18.16 at 4:20 pm

Wow baby!! Cad is rocking, time to cash in your USD.Cad up over 8 days in a row,unbelievable.Cashed out to late at $1.266.Last week $1.31.Just like real estate you snooze you lose.

#174 Victor V on 08.18.16 at 4:31 pm

A billionaire’s Bridle Path mansion sold for $5 million under its asking price.

http://torontolife.com/real-estate/houses/alex-shnaider-finally-sold-bridle-path-mansion-22-million/

#175 Bram on 08.18.16 at 4:48 pm

Bombshell from South China Morning Post.

It is starting to look like pretty much ALL luxury RE in 604 is bought by immigrants.

http://www.scmp.com/news/world/united-states-canada/article/2005794/canada-tax-chiefs-knew-foreign-moneys-big-role?utm_source=&utm_medium=&utm_campaign=SCMPSocialNewsfeed

This is going to make some waves if it’s true. And it looks pretty legit.

Nothing Ian Young writes is credible. — Garth

#176 Herb on 08.18.16 at 4:59 pm

#167 IHCTD9,

s’alright, Diesel Dipstick, ya can always tell a Conservative, ya just can’t tell him much.

#177 Bram on 08.18.16 at 5:26 pm

Nothing Ian Young writes is credible. — Garth

At least he mentions two civil servants involved by name.
And claims other workers confirmed the story.

It’s hard to make up stories if you add concrete details like that.
I would not discard it right away.

#178 Smartalox on 08.18.16 at 5:50 pm

@ White Crock BC:

Are you saying that Real Estate is now a ‘Berra’ Market?

#179 mouldyinYVR on 08.18.16 at 5:52 pm

Speaking of Young _ brought to you by MacLeans

http://www.macleans.ca/economy/economicanalysis/ian-young-on-vancouvers-freak-show-housing-market/

“We’re (Vancouver) becoming a place where people come to retire, to go to school, to go on holidays, but not to live and to earn an income that can afford housing here. The fact that we’ve got such low levels of income demonstrate that. We should not be a city that has the highest levels of wealth in Canada and some of the lowest incomes. That’s just not right.”

#180 eddy on 08.18.16 at 5:58 pm

credit card travel tip
problem-
usa gas pump wants your zip code

enter first 3 numbers of postal code associated with card add two zeros, card accepted
You just saved you 2 trips inside

#181 G&M Real Estate Crash Article today on 08.18.16 at 6:16 pm

Anyone have access to globe unlimited so they can post it here?

http://www.theglobeandmail.com/report-on-business/rob-commentary/canadas-a-real-estate-country-just-waiting-for-a-crash/article31457558

#182 mouldyinYVR on 08.18.16 at 6:32 pm

15% foreign sales tax – so what??

http://thetyee.ca/Opinion/2016/06/14/Vancouver-Foreign-Ownership-Sales-Ban/

“A foreign ownership tax of 10 per cent on a $5-million home will not stop a sale or create any affordability.” — Bob Rennie, real estate magnate, BC Liberal fundraiser.

“Bob Rennie is right. That’s why the first step toward solving Metro Vancouver’s high-priced housing problem is simple — though probably even more unwelcome to Rennie.

The government needs to ban all new foreign home ownership in British Columbia for six months.

But the B.C. government won’t impose a temporary foreign ownership ban or do anything substantial. It has turned a blind eye to the problem for more than a decade and even now is only proposing measures that are meaningless, ineffective window dressing.

The reasons for the BC Liberals inaction are obvious. First, the provincial Property Transfer Tax revenue of $1.1 billion helps balance their budget. (It’s forecast to bring in nine times as much as the $128 million in natural gas royalties’ revenue expected this fiscal year.)

And second, developers and the real estate industry that dine out on foreign investors’ mad money contributed $12 million of the $70 million in donations the BC Liberals received between 2005 and 2015 — more than any other sector, including mining and forestry.”

Again – don’t hold yer breath.

#183 mouldyinYVR on 08.18.16 at 6:49 pm

……..Vancouver realtor accused of making threats…..
……….old news, but worth a read if you missed it!

http://www.theglobeandmail.com/news/british-columbia/bc-realtor-accused-of-making-threats/article30024457/

“…..businessman said that, as a Canadian citizen, he thinks the authorities should take his complaint – and the manipulation and speculation in Vancouver real estate – more seriously.

“I am a residential buyer. I am not a stock buyer. I buy to live,” he said. “Even in China, the government it would control this. I am not sure why they don’t here.”

…………..read this and weep………

#184 Jim on 08.18.16 at 6:50 pm

#154 james on 08.18.16 at 1:48 pm

Trump is his own man, not bought or beholden by anyone, can do what he thinks is right, unlike the Clinton’s who are completely bought, paid for and avoiding Justice.

#185 RanjanaV57 on 08.19.16 at 9:49 am

American, ignore VREU. I see your point. It makes complete sense. He asked for proof, you gave it to him, and he still denies it. It was VREU who first brought up populations in certain states to counterpoint your comment that most Americans don’t want to live in Florida or Arizona. His method of trying to show pricing disparity between countries is ridiculous. Since your post I reached out to a few American friends of mine and to my surprise you are correct! Americans in general find those areas of Florida and Arizona to be less desirable than many other places in the States. They had uniform consensus that the weather and lack of culture is why they would never live there while also confirming the larger cities in those states have a very large number of Canadians and Europeans buying property there. Americans want to live on the West Coast but most cannot because of affordability.

#186 Lovebeingliquid on 08.21.16 at 12:47 am

We sold our house a few weeks before the Chinese Dude Tax came out. Just signed a 3 year lease on a decent rental. Time to buy some popcorn and watch the show.