In the rear view

passport-modified

The year will be history in a couple of weeks. Shed a tear, all ye mortgaged deplorables. It was the cheapest 12 months in, like, ever for home loans. Hope you locked in. A new era’s upon us.

What’s your mortgage rate? The average across Canada is 3.02%, down just five beeps from 2015, which was the lowest on record. According to the mortgage industry, the average rate for renewers in 2016 was 2.7%, the cheapest since people stopped trading beaver pelts and tummy rubs for housing. Of the million or so families who got a new term this year, three-quarters paid less than their old rate and the rest paid more. In 2017 and beyond, almost everyone will face a premium.

So what?

A quarter of all Canadians are so house-strapped they couldn’t find an extra $1,000 if they needed it. If rates go up a lousy quarter point, over 700,000 people will be in distress. If rates rise 1%, over a million families will be in a tough spot. That’s what. And it’s now clear the bottom is behind us.

This may be why the number who think it’s a good time to buy real estate just declined 8%. It’s obviously why Re/Max says annual price increases in Vancouver will go from 20% to 2% – and that’s still wildly optimistic. Already – despite the lowest rates on record – two-thirds of new buyers must get a boost from the Bank of Mom, and the amount of parental cash going into real estate has increased 300% in the last 25 years.

Low rates have allowed people to finance ever-rising house prices, which have allowed those prices to rise. It’s a vicious circle. Five years ago the average mortgage rate was 50% higher (the cheapest fiver was 3.51% in 2011). So now Toronto and Vancouver houses cost 50% more. Real estate has not become more intrinsically valuable. Instead, the cost of borrowing to buy it has fallen. As prices jumped and incomes did not, debt’s exploded.

That brings us to today. The perfect correlation between real estate values and interest rates will become as evident on the way down as it was on the trip up. The early indications of that are evident in the US, where mortgage rates are more sensitively tied to the bond market. So look at what’s happened since the goofy billionaire ascended:

rates-us

As you may know, Americans can lock in a rate for three decades, while most people here are on a five-year schedule. Expectations that Trumpian inflation, economic growth, trade-trashing and tax cuts will keep rates rising for some time (starting this Wednesday) could result in “rate lock”. That’s when people figure moving to a nicer, bigger house isn’t worth giving up a cheapo mortgage. So they don’t. The market locks up. Prices decline.

The rate increase to the south has been about half a point since the election a month ago. While the future’s uncertain, the betting is the Fed will raise twice next year and a few times following. Given that Americans face a similar situation to us – precious little inventory for sale and big price gains in the era of low rates – this could knock real estate back considerably.

As predicted, the Bank of Canada did not drop its key rate last week. In fact, there are no more cuts coming. The next move will be up, but that is still months away. In the meantime, however, five-year mortgages will continue to get more expensive as bond yields swell (Government of Canada five-year debt popped up considerably at the end of last week).

Layered over this economic reality is Canada’s political situation. BC declared war on property prices, and is winning. Ontario just increased its onerous land transfer tax on high-end homes. Ottawa’s Moister Stress Test is knocking 5% to 15% of first-timers out of the market, or forcing them to buy less house. New federal regs next year will force lenders to assume mortgage default risk now borne by taxpayers. Already mortgage lenders are withdrawing some home credit from the self-employed, or landlords.

None of this, of necessity, foretells a property crash. But it does mean owning a home next year will cost more. If history’s any guide, houses will cost less. But where have you heard that before?

181 comments ↓

#1 Happy Housing Crash Everyone! on 12.11.16 at 3:47 pm

Sorry realtards your lies are now powerless. Sales have stalled in the GTA and phones are slient at brokers offices. Happy Housing Crash Everyone! :-)

#2 Pete on 12.11.16 at 3:50 pm

Going to be a bad year for everyone in the real estate market. With sales tanking alone with prices it doesnt look good. Word is GTA sales have just stopped and no its not because of the time of year. Its getting ugly out there. Don’t believe realtor lies.

#3 Andrew Woburn on 12.11.16 at 3:54 pm

A reminder that refugee crises are nothing new for Canada. This from Wikipedia concerning the Irish Potato Famine. Remember that, at this time, the Irish were as least as culturally alien to conservative Canadians as Middle Eastern Muslims are today and they were also members of a “subversive” Catholic religion. They also landed with a huge antipathy to the British government which had watched as they were treated like cattle by their British landowner overlords.

“Of the more than 100,000 Irish that sailed to Canada in 1847, an estimated one out of five died from disease and malnutrition, including over 5,000 at Grosse Isle, Quebec, an island in the Saint Lawrence River used to quarantine ships near Quebec City.[112]

Overcrowded, poorly maintained, and badly provisioned vessels, known as coffin ships, sailed from small, unregulated harbours in the West of Ireland in contravention of British safety requirements, and mortality rates were high.[113]

The 1851 census reported that more than half the inhabitants of Toronto were Irish, and, in 1847 alone, 38,000 famine Irish flooded a city with fewer than 20,000 citizens.

Other Canadian cities such as Saint John, Quebec City, Montreal, Ottawa, Kingston, and Hamilton also received large numbers since Canada, as part of the British Empire, could not close its ports to Irish ships (unlike the US), and the emigrants could get passage cheaply (or free in the case of tenant evictions) in returning empty lumber holds.

However, fearing nationalist insurgencies, the British government placed harsh restrictions on Irish immigration to Canada after 1847, resulting in larger influxes to the US.

https://en.wikipedia.org/wiki/Great_Famine_(Ireland)

#4 Context on 12.11.16 at 3:55 pm

In the meantime Trump has a $1 Trillion budget for restructuring the USA and guess what he recently stated? Made in the USA for American workers, so where does this leave Canada’s prosperity for our manufacturing goods and services? Lets hope he was just kidding.

#5 Mike on 12.11.16 at 3:59 pm

No crash is coming. People living in their homes are enjoying and making money. Whatever happen to interest rates, Canadians will still pay more to buy homes. Canadians are rich people with high incomes. Even if they don’t have high incomes, they have ability to pull money from thin air. Magic.

So, Property prices never go down in Canada except a bit here and there. Edmonton is in mid of oil crash, and prices of single family still standing well.

#6 Andrew Woburn on 12.11.16 at 4:01 pm

– Everything we thought we knew about free trade is wrong

“And here’s the thing. Trump’s supporters are right to distrust the pro-free trade fanaticism of America’s political mainstream. Starting with Ronald Reagan, one after another, American presidents of both parties have oversimplified and overemphasized the benefits of free trade, without pausing to study its costs, and who was paying them—or even how exactly free trade is supposed to grow the US economy in the first place.

The intellectual and political leadership didn’t see the lasting damage of their knee-jerk free trade zealotry for the same reason that they didn’t see the moment of political payback approaching: because they didn’t think to look for it.

That lapse has now invited a populist demagogue into the White House, promising that tariffs and tough new deals will bring back low-skilled manufacturing jobs. Trump has correctly identified a problem. But by focusing only on free trade deals he risks repeating the very mistakes that conjured him forth in the first place.”

This is a long and somewhat wonkish read but an interesting take on the downside of free trade.

http://qz.com/840973/everything-we-thought-we-knew-about-free-trade-is-wrong/

#7 Alex on 12.11.16 at 4:03 pm

Great post Garth. I do however think the GTA is a different type of animal and can not see any price correction whatsoever especially when it comes to detached homes. There are any more of them, with 100K people coming every year (many with money), and seniors staying in their homes until they croak, there is pretty much no supply on the market. There are many folks who earn alot, have parents who can help them out, and real estate has only gone up in the GTA. As much as I hate to admit it, it’s now or never which leads to all the FOMO.

#8 Bram on 12.11.16 at 4:04 pm

The year will be history in a couple of weeks.

Maybe time to rate our host’s 2016 predictions?
http://www.greaterfool.ca/2016/01/01/el-predicto-3/

Some were really spot on, Garth!

The dollar slides briefly below 70 cents US. Most investors miss a once-in-a-generation chance to convert their US$ at $1.50.
Bang on!

The TSX does not lose 11%. In fact, it outperforms the S&P 500 as commodities eventually creep back.
You called it!

…average prices in the GTA and YVR spin to a new record high. It will be the last one. Ever.
I will generously call this YES. But new peaks will come of course, even if it takes a decade.

Canada slumps into negative growth until the spring, maybe even the summer.
Seems to be correct as well. http://www.tradingeconomics.com/canada/gdp-growth

Canadian household debt breaks more records.
Yes.

Some misses too, of course:

Five-year mortgage rates end the year 1% higher.
I will assume you mean percentage POINT.
This would be a NO.

Canada gets a national carbon tax.
No.

Bank of Canada raises its key rate
No.

All in all I would call it a decent prediction over all.
Better than most predictors.

#9 For those about to flop... on 12.11.16 at 4:08 pm

The story behind the photo is that the owner left it on the kitchen table the night before a trip so they didn’t forget it.

The dog reminded them to take their passport to the airport by costing the owner $700 for a new flight and $300 for a rushed new passport…

M42BC

#10 Andrew Woburn on 12.11.16 at 4:11 pm

Blog dogs have expressed a great deal of concern about the prospect of a cashless society. It is not clear to me that the mass of the population has even become aware of the issue. When they do, will they see it as another erosion of freedom and will the current rebellious mood of voters be enough to block the initiative?

Here is further proof that the issue will force itself onto the political scene in the not too distant future.

“In Denmark, the wardens of cash are now looking into producing a virtual currency instead, which they predict will make crime harder and oversight easier. The Danes aren’t alone. Britain and Sweden are blazing a trail in Europe. Singapore and Canada have already tested blockchain-based currency systems for Internet payments.

Governor Lars Rohde, whose job as of 2017 will no longer include overseeing a cash printing press in Copenhagen, says pros include lower transaction costs. But the risks are considerable. It’s uncharted territory, and the potential unintended consequences have the scope to upend the economy.”

https://www.bloomberg.com/news/articles/2016-12-11/blockchain-lures-central-banks-as-danes-consider-minting-e-krone

#11 InvestorsFriend on 12.11.16 at 4:21 pm

American Home Prices Will Rise

“Given that Americans face a similar situation to us – precious little inventory for sale and big price gains in the era of low rates – this could knock real estate back considerably.”

****************************************
Garth also listed some dissimilarities like the 30 year lock in and the lack of a war on house prices (Chinese dudes tax and increased property transfer taxes).

Garth has I believe pointed out that America home prices are generally nowhere near as stratospheric as in Canada as they took big declines in the financial crisis and remain shell-shocked by that.

The lower home ownership rate in the U.S. has also been noted.

Overall, I believe American home prices will continue to rise aided by a rush to get in before mortgage rates rise even higher.

#12 calgarytran on 12.11.16 at 4:24 pm

Safe haven for C$? Where?

#13 For those about to flop... on 12.11.16 at 4:33 pm

There was some chatter on the blog about society going
cashless and money related stuff and so I will leave this here for currency buffs…

M42BC

https://howmuch.net/articles/33-facts-you-didnt-know-about-us-money

#14 crossbordershopper on 12.11.16 at 4:34 pm

go to rurual saskatchewan, still get little houses for 50 grand or so. sure your in the middle of nowhere, but when you are retired, living on minimum goverment pension, and spend six months a year down south, who needs a footprint, have everything, health cards, security, gtd cheque, get out of southern ontario, the snow is about to arrive.

#15 InvestorsFriend on 12.11.16 at 4:39 pm

No 25 Year Lock-in in Canada – WHY oh WHY?

“As you may know, Americans can lock in a rate for three decades, while most people here are on a five-year schedule.”

**************************************
Yes, AND those America 30 year locked in mortgages are basically OPEN from the git-go with modest fees but no interest differential to pay if you want to get out early to sell or refinance to a lower rate. AND the rates are lower than the 10 year rates that can be had at prohibitive rates in Canada. It’s heaven compared to Canada.

(And no, securitization, as such did not cause the mortgage crisis, it was giving out bad loans and placing bad credit ratings on the securities that did that. Securitisation is still the practice in the U.S. because banks can’t safely fund 30 year locked in mortgages with short-term deposit money)

I have tried for over ten years to get an answer to why something similar could not be offered in Canada. I talked to CMHC, the International monetary agency and others.

Now, I do know that this system would require the banks to securitise the mortgages and sell to investors willing to accept the risk of early payments. In Canada the CMHC and other rules PREVENT the banks from securtitising such mortgages. Most or all insured mortgages MUST be securitixed only through CMHC. WHY?

No one has given ANY credible answer. They mumble things like investors in Canada would not buy the mortgage securities. On what evidence?

CMHC and the government could STILL become national heroes by offering locked in yet OPEN mortgages for 25 years. This would remove a HUGE risk from homeowners (who switched to the new mortgages). But no one has even tried to do this. Why oh why?

Well, maybe it IS too late to do anything now. It’s sad. If rates really rise it will be a disaster for Canadians with big mortgages but not for American home owners.

#16 WaitingOnTheWorldToChange on 12.11.16 at 4:43 pm

garth….I understand the point you are making but do believe that you are taking it to an extreme that actually undermines the strength in your argument. Case in point…I have a five year fixed mortgage expiring in April 2017 at 2.99%. I just received a letter in the mail from my banker offering me a four year fixed at 2.34% if I confirm by Dec 31st? So….in 2017 my mortgage is coming up for renewal at .65% less than what I am paying now?

Additionally….a lot of your base arguments may come to fruition one day but you haven’t really been spot on in the past? For example…you are heralding the current growth of the US and Canada at 3.5% but it is for Q3 only. In 2015, the US had a strong Q2 where you started to position the new growth phase of the US to only see it bomb in Q3 and Q4. With a strong dollar and high volatility in bonds and with global growth being downgraded by the IMF there are sufficient risks to suggest that your adament position that the US will raise rates twice more in 2017 after the rise in December will also be wrong.

You have argued strenuously, repeatedly, in an ad hominem and condescending fashion there will be no increase on Wednesday. That will, officially, be your last day on this site. Enjoy the next 48 hours. — Garth

#17 paulo on 12.11.16 at 4:45 pm

Good article. Anybody with common sense can see the Real Estate “Ponzi Party” party is over. Only question is how painful the hangover will be.

Also read the re max predictions, couldn’t help remembering there corporate logo is a “hot Air Ballon”
i suspect it refers to there predictions of 2% increases in value next year…LOL , but if you are buying that, i have a bridge in Brooklyn for sale cheap!

#18 the market to FINALLY beat real estate? on 12.11.16 at 4:48 pm

the 10 year TSX average return? a whopping 4.70%…lol. Add two percent or so if you were balanced…..

2016 YTD advance for the TSX is 17.7%. The one-year gain is 23.3%. — Garth

#19 Brapp on 12.11.16 at 4:48 pm

It’s the families using there HELOC to pay off there bills every year is what I’m curious to see what happens. I know lots of couples that have maxed out there LOC, only to have there house go up in value, remortgage and go again (get out of debt free card). That party will soon finally be over..

#20 WaitingOnTheWorldToChange on 12.11.16 at 4:49 pm

#01…Happy Hosuing Crash…Sorry realtards your lies are now powerless. Sales have stalled in the GTA and phones are slient at brokers offices. Happy Housing Crash Everyone! :-)

Really? The data would suggest otherwise?

https://www.thestar.com/business/real_estate/2016/11/03/october-is-another-hot-month-for-torontos-real-estate-as-prices-soar.html

#21 Victor V on 12.11.16 at 4:51 pm

https://betterdwelling.com/city/vancouver/bcrea-vancouver-real-estate-expected-lose-1730-week-2017/

Economists from the BCREA project the average benchmark price will drop 8.7% by the end of next year. This would bring the average home in the GVA down to $940,000. Great if you’re a buyer, a total nightmare if you’re a homeowner looking to sell next year. The drop works out to around $90,000, which is around $1730 a week. This is in contrast to the 14% increase we saw in the previous 12 months to November.

#22 Nemasis on 12.11.16 at 5:02 pm

DELETED

#23 thanks Garth.... on 12.11.16 at 5:07 pm

‘the 10 year TSX average return? a whopping 4.70%…lol. Add two percent or so if you were balanced…..

2016 YTD advance for the TSX is 17.7%. The one-year gain is 23.3%. — Garth’

i’m fully aware. I also know it gave about 10% away a year ago . AND, again its 10 yr average is a yucky 4.70%. I was simply pointing that out, :) …..time for it to catch real estate the next 10 years?

#24 a man about a dog on 12.11.16 at 5:10 pm

Who doesn’t like the idea of a cashless society? We have the boomers sitting on huge amounts of cash and overly generous pensions who will penny pinch right into their twilight years forcing the economy into deflation.

Force them to spend it, invest it, do something with it. Isn’t holding cash or even gold an inefficient use of capital? I don’t see the downside here can somebody help me out?

#25 a man about a dog on 12.11.16 at 5:15 pm

@ Brapp

I have a friend who is getting a 70k HELOC to pay down about 50k worth of credit card debt and use the rest for renovations. I forget the rate he told me he’s getting on it but apparently pretty good also believes house prices always go up.

#26 Gary on 12.11.16 at 5:17 pm

Garth,
What you say makes sense, but I can’t understand why given the carnage in Calgary with all of the layoffs and oil having tanked two years ago, prices are only down about 10 percent. I guess not many people are highly leveraged?

#27 Self Directed on 12.11.16 at 5:20 pm

#5 mike sounds jealous. What’s the matter, cant make money the good ole fashoned magic way? Trust me mike, they are not rich. Its called credit. Or HELOC. All that debt will need to be repaid. Oh and expect everything to cost more next year along with a nice irreversible property tax increase. Homes will be flat. Party is over. No more increases. No more “free” money.

Keep saving Mike. Its the only way out.

#28 Context on 12.11.16 at 5:26 pm

The above photo caption tells me that is one intuitive dog giving his owner a message. The dog chewed off the name CANADA, as it knows something bad is about to happen.

#29 Metaxa on 12.11.16 at 5:27 pm

Hey, Garth, I’m a smart person, I don’t need these blogs everyday.

Let me know if something important comes up meanwhile I have a reality TV show I’m working on, k?

#30 Grantmi on 12.11.16 at 5:29 pm

#5 Mike on 12.11.16 at 3:59 pm
No crash is coming. People living in their homes are enjoying and making money. Whatever happen to interest rates, Canadians will still pay more to buy homes. Canadians are rich people with high incomes. Even if they don’t have high incomes, they have ability to pull money from thin air. Magic.

So, Property prices never go down in Canada except a bit here and there. Edmonton is in mid of oil crash, and prices of single family still standing well.

Are you smoking some of the West Coast wacky stuff Mike? You have no idea what’s about to be released on to the Canadian home owner masses.

#31 drydock on 12.11.16 at 5:31 pm

#9 For those about to flop… on 12.11.16 at 4:08 pm

The story behind the photo is that the owner left it on the kitchen table the night before a trip so they didn’t forget it.

The dog reminded them to take their passport to the airport by costing the owner $700 for a new flight and $300 for a rushed new passport…

M42BC

…………………………………………………………….

A cat would have sat on the passport and and stared meaningfully at you.
Unlike the drooling chew everything in site rodent.
Cats rule.

#32 Victoria Real Estate Update on 12.11.16 at 5:32 pm

# 5 Mike

Your information is wrong.

In the 80s housing markets in Vancouver, Victoria, Edmonton and Calgary crashed. In the 90s, Toronto’s housing market crashed.

Vancouver and Victoria could easily crash. All
Canadian markets are in bubbles.

Canada’s housing bubble is, perhaps, the biggest the world has seen.

An epic crash could happen across Canada. There is no data-based/ history-based argument that can eliminate this as a possibility.

#33 Andrew Woburn on 12.11.16 at 5:38 pm

15 InvestorsFriend on 12.11.16 at 4:39 pm
No 25 Year Lock-in in Canada – WHY oh WHY?
=======================

Good question. Why can’t major Canadian insurance companies simply offer 25 year mortgages directly to householders? Is it a regulatory issue? Do we honestly believe that American investors who are used to financing long term mortages would not step up to the plate if given a chance even if Canadians supposedly wouldn’t? Who provides the long term money in the US anyway? Why do we need “renewal roulette”?

#34 Awesome Toronto Real Estate Agent on 12.11.16 at 5:39 pm

Wow!!!! What nasty Jealious people saying nasty things that I am a cheat, liar and no good bum and Happy that they think I won’t be able to make a living and feed my family! Well when you have integrity and a ability to connect and earn people’s trust you sell property on the way up and sell property on the way down!!!
At least I know not to criticize someone’s chosen profession especially a great one like mine !!!!

#35 crowdedelevatorfartz on 12.11.16 at 5:46 pm

@ Apocalypse 2016

Yer runnin outta time brudda….

And dont forget.
I patented Apocalypse 2017 so either refrain from using it or be prepared to visit the smellevator…..

#36 crowdedelevatorfartz on 12.11.16 at 5:49 pm

@#33 Awesome Realturd

Sorry but after reading all your spelling and grammatical errors …..
I think the Real Estate Association should be vetting people for integrity AND intelligence.
I can dream cant I?

#37 Wait There on 12.11.16 at 6:15 pm

#6

Great article…..a lot of the thoughts presented had crossed my mind. While protectionism will not revive what has been lost a key question is What now? We’ve identified the problem. We can’t cop out and say we don’t have a solution. A leader must try something.

There is no doubt that China despite what the globalists has been a major component of the problem simply because of its sheer size and fast appearance into the global scene. No economist theory or models can DYNAMICALLY model what would and could take place. They predict endpoints but are unable to indicate the swings and that is what the problem with economists are they are too unsophisticated in their theory and models to be advisers for leaders who need real time scenarios.

#38 Andrew Woburn on 12.11.16 at 6:17 pm

a man about a dog on 12.11.16 at 5:10 pm
Who doesn’t like the idea of a cashless society? We have the boomers sitting on huge amounts of cash and overly generous pensions who will penny pinch right into their twilight years forcing the economy into deflation.
===================

First of all most boomers are nowhere near rich and those that are often hold their wealth in dubiously inflated home equity. Many of the younger boomers don’t even have relatively generous pensions unless they are employed by governments. Even then, a typical couple of grand a month is not Las Vegas money.

Secondly, what you are really talking about is not so much a cashless society as the resulting ability to force negative interest rates on savers. No government has yet tried this at the retail level and it is doubtful that any democratic regime would survive the instant backlash.

The notion that any amount of pressure would force retirees to spend is totally mistaken. What you call penny pinching is just a stage of life thing. I don’t need another suit, $300 sneakers or the latest iPhone. If you put me under pressure I will just find a static asset that I hope is inflation proof like collectibles.

If boomers have wealth over and above their home equity it is usually already invested or in GIC’s which are essentially a loan to a bank. The bank has already lent out this out to a millennial to buy an overpriced condo.

In my view that real deflationary threat is the vast overhang of unrepayable debt not the modest spending plans of boomers. Since these days, the money supply consists mainly of bank or sovereign debt, it is obvious that is will shrink dramatically if and when the world is forced to face the facts of uncollectibility and the limits of the public purse.

#39 AK on 12.11.16 at 6:38 pm

” tax cuts will keep rates rising for some time (starting this Wednesday)”
——————————————————————
There is talk that the Fed may do a .50 point increase on Wednesday. Is that possible. ?

#40 Wild Albertan Gonads on 12.11.16 at 6:49 pm

Keystone a slam dunk with Exxon’s TRex as SoS ….Jan. 20

http://www.calgaryherald.com/business/trump+says+keystone+news+coming+soon+blasts+costs/12513136/story.html

#41 WaitingOnTheWorldToChange on 12.11.16 at 6:51 pm

You have argued strenuously, repeatedly, in an ad hominem and condescending fashion there will be no increase on Wednesday. That will, officially, be your last day on this site. Enjoy the next 48 hours. — Garth

That is a shame that you do not welcome diverse opinions. I would argue that my positions use logic and facts and certainly aren’t as condescending as many others on here, yours included. I guess you just prefer “followers” who do not question.

#42 Tony on 12.11.16 at 6:59 pm

Watch The Poseidon Adventure (movie 1972) and see what happened to almost all of the people aboard. It reminds me a lot of the home owners in the GTA.

#43 Hotdogs from Heaven on 12.11.16 at 7:00 pm

#24 a man about a dog on 12.11.16 at 5:10 pm
Who doesn’t like the idea of a cashless society? We have the boomers sitting on huge amounts of cash and overly generous pensions who will penny pinch right into their twilight years forcing the economy into deflation.

Force them to spend it, invest it, do something with it. Isn’t holding cash or even gold an inefficient use of capital? I don’t see the downside here can somebody help me out?
——————————————————–
A cashless society simply means having no physical cash like bills and coins.

Boomers are NOT sitting on piles of physical cash. It’s all ones and zeros in stock exchange and bank computers just like your own digital currency and investments.

The problem with a cashless society is that it may take away an individual’s ability to choose what they spend their money on. Much like the card that food stamp recipients get in the U.S. that now prevents them from buying booze or cigarettes. You may be prevented from buying anything that a government bureaucrat does not want you to buy, only with your own hard earned money.

#44 Moira Drosdovech on 12.11.16 at 7:00 pm

An example of too much house, too much mortgage and too little income.
http://www.theglobeandmail.com/globe-investor/personal-finance/genymoney/vancouver-couple-forced-to-take-out-second-mortgage-to-cover-unforseen-renovations/article33273585/?reqid=0f6630ca-e602-477b-bb43-712333d3aeab

#45 InvestorsFriend on 12.11.16 at 7:03 pm

Yeah, It’s Paper-Cashless not Cashless

#24 a man about a dog on 12.11.16 at 5:10 pm

Who doesn’t like the idea of a cashless society? We have the boomers sitting on huge amounts of cash and overly generous pensions who will penny pinch right into their twilight years forcing the economy into deflation.

Force them to spend it, invest it, do something with it. Isn’t holding cash or even gold an inefficient use of capital? I don’t see the downside here can somebody help me out?

***********************************
When we speaking of going cashless it means getting rid of paper cash only.

In reality the HUGE majority of cash consists of transferable “deposits” in banks. THAT is NOT going away.

It has been covered here that most deposits originate when a bank makes a loan. So one person’s deposit is another person’s loan.

The cash deposits held by individuals and corporations are matched up with loans that have been spent on assets, productive or otherwise.

When cash (a bank deposit) is spent it just becomes someone else’s deposit. So it does not go away when you force someone to spend it.

So, Cash is NOT going away, just paper cash, which has become archaic.

To lower the amount of cash deposits you have to encourage people to pay off loans. That process destroys cash just as making a loan creates it. Strange but true.

All those arguments about corporations sitting on excess cash are also garbage since that “cash” is in the bank matched by loans to others. It’s not greenbacks in the office safe or in the bank’s vault.

All paper cash is money but by far the great majority of money is not in the form of paper cash and never was and never will be. All money is cash but not all cash is paper.

#46 Winterpeg on 12.11.16 at 7:04 pm

So my house will fetch a lower price next Spring?
Or is there still a window of opportunity?
(Winnipeg market, which has been mixed this fall)

#47 Tony on 12.11.16 at 7:06 pm

Re: #20 WaitingOnTheWorldToChange on 12.11.16 at 4:49 pm

Wait ’till the numbers come out for December. Hint day trades for Home Capital and the Canadian version of Genworth. Its a long way down. The last crash many of the immigrants went back home. Watch for a repeat.

#48 not 1st on 12.11.16 at 7:14 pm

Nothing to get your knickers in a knot over. Rates popped in 2013 too after the last election and sunk right back down. There isnt enough growth or inflation anywhere in the world right now to even think about raising rates. Fed is just desperate to get rates off the floor in case they have to drop them again.

#49 dr. talc on 12.11.16 at 7:24 pm

#33 Awesome Toronto Real Estate Agent on 12.11.16 at 5:39 pm
Wow!!!! What nasty Jealious people saying nasty things that I am a cheat, liar and no good bum and Happy that they think I won’t be able to make a living and feed my family! Well when you have integrity and a ability to connect and earn people’s trust you sell property on the way up and sell property on the way down!!!
At least I know not to criticize someone’s chosen profession especially a great one like mine !!!!

salesmanship is underappreciated here

#50 Victor V on 12.11.16 at 7:33 pm

https://www.bloomberg.com/news/articles/2016-12-11/oil-seen-headed-to-60-after-saudis-signal-deeper-output-cuts

Oil may climb to $60 a barrel for the first time in almost a year and a half after Russia and other unaffiliated nations joined an OPEC pledge to reduce production and Saudi Arabia surprised the market by saying it will cut more than previously agreed.

#51 Mark on 12.11.16 at 7:40 pm

“Why can’t major Canadian insurance companies simply offer 25 year mortgages directly to householders?”

The Canada Interest Act is the issue here. So yeah its a regulatory issue.

Not sure if it applies to provincially regulated loans from provincially regulated institutions. Anyone?

CMHC and the government could STILL become national heroes by offering locked in yet OPEN mortgages for 25 years.

Sure, but I think Canada has fared better, as an economy, having interest rate risk vested with the borrowers, rather than with the banks. Canadian bank failures over the years have been virtually non-existent. Contrast this with widespread bank failures in the United States.

I don’t see why there would be any legitimate public policy reason why the government would want to change things such that people are borrowing more and for longer-terms against housing. Remember that credit almost always makes stuff more expensive over time. How exactly is it in the best interests of Canadians to create (or change) policy that encourages more borrowing? If anything, the CMHC should be abolished so that borrowing and lending is purely and strictly a function of the private sector. Taxpayers should not be subsidizing home ownership, nor the banks, through the CMHC. The CMHC is poised to be enough of a catastrophe for Canadian taxpayers in and of itself, nevermind any sort of expansion.

#52 eddy on 12.11.16 at 7:46 pm

#1 Happy Housing Crash Everyone! on 12.11.16 at 3:47 pm
Sorry realtards your lies are now powerless. Sales have stalled in the GTA and phones are slient at brokers offices. Happy Housing Crash Everyone! :-)

—-

How do you keep your sanity between Star Trek conventions?

#53 Small_Town_Steve on 12.11.16 at 7:51 pm

I locked in this summer on my renewal on a 5yr fixed at 2.65% just before all the crap started hitting the fan. I was at 3.01 on my first 5 year that I just replaced.

#54 Toronto FC CRUSHED!! TORONTO SUCKS!!!!! on 12.11.16 at 7:57 pm

Ha!! All you losers in the 416 and 905, you are pathetic!!!

Toronto FC DESTROYED by Seattle!!!!!!!!!!

Idiot Toronto management pulls the best player, Sebastian Giovinco, in extra time. WTF!!!???

Of course, this is the same management that gouged loyal fans out of their season ticket seats for the finale, in the same city that has traded away Sittler, Clark, Gilmour and Sundin. How Toronto can you be!!??

Toronto FC fans, like Blow Jays fans, throw stuff at their opponents – what ignorant thugs live here!!

http://www.georgiaworld.com/2016/12/11/mls-cup-toronto-soccer-fans-reportedly-hurl-cans-food-at-seattle-team/

The Raptors go extinct every year, FC falls in the autumn, the Leafs fall in the spring, the Blow Jays and Argggghoes have fallen and can’t get up!!

Toronto – a second class city that has a subway system outdated even by 1950s standards, a broken down infrastructure and a city budget about to collapse once the windfall land transfer tax (about $500 million now) withers away. Then tax increases will wipe out any memory of this bubble!

Toronto – a city with impoverished inner and outer suburbs, where violence is climbing and unemployment is soaring. VERY SCARY PLACES!!!

Toronto – a city with 40,000 too many realtors, and delusional idiots who have gambled every dollar they can borrow on a real estate bubble about to explode!!!

Toronto – a town of losers who think they are world class. Perfect suckers for anyone who has dumped their real estate already!

TORONTO SUCKS!!!!!!!!!!!!!!!!!!!

#55 Ret on 12.11.16 at 8:01 pm

#6 A.W.
This is a long and somewhat wonkish read but an interesting take on the downside of free trade.

http://qz.com/840973/everything-we-thought-we-knew-about-free-trade-is-wrong/

Thanks for the link. Well worth the read.

Every time Jean Chretien and his entourage of a hundred or more went on a trade mission to China, Hamilton lost another industry on Burlington Street. No industry escaped globalization. Unbelievably, this town kept voting Liberal as Burlington Street was decimated. Hamilton is still a Liberal trifecta to this day.

NAFTA was the start of the decline but factories had slowly started to move out even before Nafta. China landed the knock out punch.

Hamilton will never recover to where it was. A few “green shoots” but they never grow to amount to anything. The only good jobs now are government jobs.

#56 Debtslavecreator on 12.11.16 at 8:08 pm

Those who’ve taken on massive RE debt in the last 5 years will come to regret it. Taking on a big mortgage with rates at multi decade nominal and more importantly real rates to help buy or renovate a decaying asset trading at multi decade nominal and real prices is essentially financial suicide looking out 5-10 years

Those in Europe, Japan and USA (USA from 09-12) are brilliant for buying a home trading at multi decade low nominal and real prices using FIXED rate mortgages selling at multi decade nominal and real low rates

This cannot and will not end well for millions of Canadians in the next 2-3 years if the US bond yields rise anywhere near the 4-6 % on the 10 year note as Gundlach and several other star money managers expect

Taking a mortgage out in Canada is playing roulette with the largest and most dangerous market in the world

Those counting their home “equity” gains will come to realize they were simply lucky to have had rates drop steadily to record lows

Bond markets always win – in Canada you cannot lock-in a fixed rate at a fair rate for anything more than 5 years
The 10 year is priced to make it silly

#57 Polls R Phake on 12.11.16 at 8:10 pm

Ahhhh the hate on for the Donald just never stops. Well just wait until he and his new EPA guy completely expose the hoax of global warming. Does anyone think that Christy and her band of Libs will give back the hundreds of millions of dollars they have stolen from the people of BC?

#58 Context on 12.11.16 at 8:11 pm

#33 Awesome:- Your confession has been accepted for your past sins against humanity, as your greatness has been noted over the years.

#59 bdwy sktrn on 12.11.16 at 8:16 pm

#24 a man about a dog on 12.11.16 at 5:10 pm

Force them to spend it, invest it, do something with it. …. I don’t see the downside here can somebody help me out?
———————-
how about you better yourself to the point of not feeling the need to stick your big nose into other peoples business and bank accounts.

#60 bdwy sktrn on 12.11.16 at 8:18 pm

#52 eddy on 12.11.16 at 7:46 pm
#1 Happy Housing Crash Everyone! on 12.11.16 at 3:47 pm
Sorry realtards your lies are now powerless. Sales have stalled in the GTA and phones are slient at brokers offices. Happy Housing Crash Everyone! :-)

—-

How do you keep your sanity between Star Trek conventions?
—————–
this person lost that a long time ago.

he’s even more pathetic and bitter than vreu.

#61 RIL on 12.11.16 at 8:21 pm

Nothing pretty in the Nov #s from the Ft. Mac REB. A tiny market though (pop. ~80K) and tiny volumes but outsized family incomes and high priced houses.

http://www.fmreb.com/sites/5098200ae7e1b41bc50042de/content_entry50bf9565e7e1b41bc501133d/5849cdc15918ada1aa0615d1/files/November_2016.pdf?1481231809

#62 Andrew Chan on 12.11.16 at 8:32 pm

The current housing market mess. We should blame the banks for enticing financially vulnerable into the cheap money trap. Then reports record earnings. We should blame the speculators, both local and foreign, for blowing the bubble earnestly. The buyers for throwing prudence into the wind. We should also blame the governments for allowing the wild party to carry on.

The physics of a bubble is that it will burst.

Greedy players insist on looking the other way. Good times must continue to roll, no matter what.

#63 bdwy sktrn on 12.11.16 at 8:33 pm

#39 AK on 12.11.16 at 6:38 pm
” tax cuts will keep rates rising for some time (starting this Wednesday)”
——————————————————————
There is talk that the Fed may do a .50 point increase on Wednesday. Is that possible. ?
———————-

not possible but laughable.

#64 23.3% on 12.11.16 at 8:43 pm

2016 YTD advance for the TSX is 17.7%. The one-year gain is 23.3%. — Garth

Historic bubble running up to historic crash – no fundamentals support this growth as pointed out daily on this blog.

Paper gain is not realized unless you sell. Similar as with money in the house.

TSX reacting to oil, in large part. Rebalancing provides consistent profit harvesting. Try rebalancing your house. — Garth

#65 Smoking Man on 12.11.16 at 8:43 pm

My God, my familys gone nuts. Fighting over the remote.

They found karaoke on the TV.. Lord take me now or get me a drink. Fine Il get it myself.

#66 I don't know on 12.11.16 at 8:45 pm

“Given that Americans face a similar situation to us – precious little inventory for sale and big price gains in the era of low rates – this could knock real estate back considerably.” – Garth

———————————————————

You just don’t stop Garth. This same message all these years while RE has bolted northwards. Well, I don’t think rates will rise for a number of reasons. Some of the dire consequences you’ve listed are one. As well, every govt. is pickled in debt. They can’t afford higher rates if they want to continue servicing those debts. So ,the vaporous fear of higher rates is no reason to stay away from RE and those that predict lower RE prices will continue to be wrong. As they have been for many years.

Recency bias can be lethal. — Garth

#67 bdwy sktrn on 12.11.16 at 8:46 pm

#50 Victor V on 12.11.16 at 7:33 pm
https://www.bloomberg.com/news/articles/2016-12-11/oil-seen-headed-to-60-after-saudis-signal-deeper-output-cuts

Oil may climb to $60 a barrel for the first time in almost a year and a half after Russia and other unaffiliated nations …..
——————–
cha-ching baby! i bet the farm on this one.

once it hits 65 it’s very early retirement time and the end of canadian (even in 604) winters for good for us.

go trump – go oil. it’s STILL freezing here in van , bring on the climate change (previously global warming)

thankfully it’s cozumel and 80F water temps for the next few weeks, van can freeze in the dark for the next month for all i care

#68 bdwy sktrn on 12.11.16 at 8:53 pm

#54 Toronto FC CRUSHED!! TORONTO SUCKS!!!!! on 12.11.16 at 7:57 pm
Ha!! All you losers in the 416 and 905, you are pathetic!!!

Toronto FC DESTROYED by Seattle!!!!!!!!!!
————–
this is why soccer sucks…..

shots on goal in regular time for seattle – 0

snoozefest!

i would saw off both arms and a leg to stay in vancouver vs the agony of living in toronto.

#69 PM Wonderful to be on 12.11.16 at 8:53 pm

“What we have to realize is Justin is a surfer dude and his friend (senior political adviser) Gerald Butts is a vampire sucking the blood (out of country). I may have to bring garlic with me,” said O’Leary.

#70 InvestorsFriend on 12.11.16 at 8:54 pm

Another “Brilliant” Post From Mark

#51 Mark on 12.11.16 at 7:40 pm sort of answers:

“Why can’t major Canadian insurance companies simply offer 25 year mortgages directly to householders?”

The Canada Interest Act is the issue here. So yeah its a regulatory issue.

************************************
Thanks for the non explanation. It has been pointed out on this blog in the past that the Bank Act makes all mortgages open after five years.

THAT is decidedly not the problem since all the those 30 year mortgages in America are open from the very start.

If you have an actual explanation, please provide it.

But yes, as my post indicated the problem has to do with regulations that control how banks securitise CMHC insured mortgages. And even it is was the interest rate act, the issue is why can’t it be fixed?

Andrew Woburn said it well, Canadians are being forced to play an interest rate roulette wheel. Basic Finance teaches that you finance long-term assets at long-term rates. Something is preventing this in Canada whereas the U.S. came up with a great solution that also keeps the mortgages open for pre-payment. This is NOT what caused U.S. bank failures.

#71 Context on 12.11.16 at 9:00 pm

I got this feeling that those in Toronto who want to bail out of your tiny over priced condo box high in the sky should do your listing in mid February. This is the month that the sales start rolling as most will be waiting for tulips in the springtime. Now if your lucky you might find a greater fool to buy in March for a 30 day closing or later.

#72 bdwy sktrn on 12.11.16 at 9:12 pm

Rebalancing provides consistent profit harvesting. Try rebalancing your house. — Garth
——————
well that would have been a very big mistake for the past 15 yrs in to/van (at least till this spring in 604)

i considered selling house when i started reading this blog, i did not sell, and would have missed almost exactly a mil (tax free) if i had.

keep paid off RE for ever – never sell it.

#73 Chico on 12.11.16 at 9:13 pm

#41 WaitingOnTheWorldToChange on 12.11.16 at 6:51 pm

You have argued strenuously, repeatedly, in an ad hominem and condescending fashion there will be no increase on Wednesday. That will, officially, be your last day on this site. Enjoy the next 48 hours. — Garth

That is a shame that you do not welcome diverse opinions. I would argue that my positions use logic and facts and certainly aren’t as condescending as many others on here, yours included. I guess you just prefer “followers” who do not question.

———————

You’re clearly not paying attention. Garth is about as laid back as one can get regarding what wild, crazy and plain stupid crap he will allow to be shared on this site. If you are ticking him off so much that he’s promised to ban you, you are indeed somebody very very very special!

#74 Barb on 12.11.16 at 9:18 pm

“…Americans can lock in a rate for three decades…”

——————————–

Plus they can deduct their mortgage interest.

#75 Timberrr on 12.11.16 at 9:18 pm

Declining RE seems to be happening across the pond as well…

“London House Prices Are Having Their Worst December in Years”

https://www.bloomberg.com/news/articles/2016-12-12/christmas-joy-eludes-london-housing-as-asking-prices-plunge

#76 Context on 12.11.16 at 9:24 pm

Doug was mentioning the other day about the power of technology, and likewise Sir Lew. You might remember a few days ago that the Russian rocket sending up needed supplies to the International Space Station was unsuccessful. I saw something a few minutes ago on RT you tube video that took me by surprise as saw not a word in MSM. The needed supplies are on the way with a huge space rocket by guess who? No, not by Canada, but JAPAN.

#77 Herb on 12.11.16 at 9:29 pm

#6 Andrew Woburn,

just joining the ranks of the grateful for that link. Great find – makes too much sense.

#78 TurnerNation on 12.11.16 at 9:29 pm

If I had to pick two other ETFs trading in USA:

EWU – Britain Ishares

IHI – Medical devices ETF (Think oldsters hardware and pumps… :-o)

#79 common sense on 12.11.16 at 9:36 pm

Is there an agreed upon % loss to accurately call something a “crash?”

#80 Mike on 12.11.16 at 9:39 pm

Can someone explain why Edmonton and Calgary Single family homes are down so little in face of severe layoffs.

Nothing can stop Canadian real estate going up and up.

#81 When Will They Raise Rates? on 12.11.16 at 9:40 pm

#24 a man about a dog on 12.11.16 at 5:10 pm

Who doesn’t like the idea of a cashless society? We have the boomers sitting on huge amounts of cash and overly generous pensions who will penny pinch right into their twilight years forcing the economy into deflation.

Force them to spend it, invest it, do something with it. Isn’t holding cash or even gold an inefficient use of capital? I don’t see the downside here can somebody help me out?
———————

Sure I’ll help you out.

“Who doesn’t like the idea of a cashless society?”

Anyone who:

a) doesn’t like the idea of the government having the ability to track ALL of his/her transactions,

b) doesn’t want all of his/her money in a bank in case of a power outage,

c) doesn’t want a fee added to every transaction, and

d) doesn’t want to be subjected to their money being confiscated in the form of negative interest rates.

“Force them to spend it, invest it, do something with it.”

Why should the state have the ability to force its citizens to do anything? Do you believe that Canada should be a free country, or would you prefer to live in North Korea? If so, why don’t you move there?

#82 a man about a dog on 12.11.16 at 9:41 pm

59 bdwy sktrn on 12.11.16 at 8:16 pm
how about you better yourself to the point of not feeling the need to stick your big nose into other peoples business and bank accounts.
____________________________

Doesn’t matter what people do with their money just that they do something with it. Feeling bad about yourself tonight? You should be used to that feeling by now.

Andrew W, hot dog heaven, investorsfriend: thanks for the replies.

#83 When Will They Raise Rates? on 12.11.16 at 9:46 pm

e) anyone who doesn’t want their money stolen via bank bail-ins.

#84 UBC Andy on 12.11.16 at 10:00 pm

Hey smoking man, quite obvious ur the smartest alien that posts on this blog, besides u making huge money on forex trading what do you else invest in? Thx

#85 Smoking Man on 12.11.16 at 10:01 pm

If you make a mistake, screw up, not wanting to take responsibility.

Blame the Russians.

#86 23.3% on 12.11.16 at 10:03 pm

TSX reacting to oil, in large part. Rebalancing provides consistent profit harvesting. Try rebalancing your house. — Garth

How is it possible to rebalance the large 23% TSX gain (plus record US stock gains at the same time) without breaking the balance of the entire portfolio made of very specific percentages of various index ETFs, bonds, etc.?

If you lock in the TSX profit to buy more currently underperforming (and therefore possibly cheap) other investments, would not you become overweight on those asset classes in the overall mix?

#87 Entrepreneur on 12.11.16 at 10:08 pm

The world is definitely in a mess and what to do about it.

A leader has to look after their own province/country first because the leader speaks for the people that live within the boundaries and the other issues will follow and hopefully corrected for today’s standards.

All I have to say is “WOW” to Brad Wall, premier of Saskatchewan, for speaking out for the people that live within the boundaries. People need work to live and grow. We need someone like him to represent us here in B.C.

The U.S. is our biggest trading partner and Canada seems to want to be different: When T1 was leader he brought in the metric system, different from the U.S. imperial system, our old system: T1 made it official for two languages for Canada but one official language in the States; and now the National Carbon Tax for everyone in Canada.

We signed a petition against the National Carbon Tax with Canadian Taxpayer Federation at Taxpayer.com. Take time to read the site, informative. Also read about how Australia had a carbon tax but dropped it two years later.

Repeat, U.S. is our biggest trading partner, try not to be different Canada or jobs will be lost.

I do have a hard time with this Canadian National Carbon Tax, and on the other hand, pipes, ships, trucks are shipping our raw resources out of Canada. Where is the logic in this thinking, not for Canadian workers.

#88 Barb on 12.11.16 at 10:08 pm

#43 Hotdogs from Heaven on 12.11.16 at 7:00 pm

“…The problem with a cashless society is that it may take away an individual’s ability to choose what they spend their money on. Much like the card that food stamp recipients get in the U.S. that now prevents them from buying booze or cigarettes. You may be prevented from buying anything that a government bureaucrat does not want you to buy, only with your own hard earned money.”

—————————–

Exactly!
I rather like buying firewood with cash…the warmth is sweeter.
I rather like buying work from a casual labourer with cash…employees are happier.

In my snowy frozen rural mailbox today, lo and behold a card from the Government of Canada, entitled “Have your say about our democracy”.

It continues: “The Government of Canada invites you to explore how your opinions about our democracy compare to those of other Canadians. Visit http://www.MyDemocracy.ca or call 1-844-690-8363 before December 30, 2016 and take part in the national conversation on electoral reform. Participate at http://www.MyDemocracy.ca“.

Electoral reform is neither at the top of my list nor is discovering how my opinion compares with other Canadians’. A voting seat at the UN isn’t high on my list; also I believe legalizing marijuana should be a LOT further down T2’s list.
And Dear T2–presuming the GoC survey has extra space under the “Other” column–you’re a fan of totalitarianism?
Oh, ok, now that you may outlaw cash transactions, please bring me firewood (birch, split, 18inches), a pizza and a screwdriver with a “star” tip to straighten the wall receptacle.

The 250m driveway has quite a bit of snow to shovel but I’ll have the big light when you arrive from your day job. Thank you, T2!

yours, etc.

#89 Smoking Man on 12.11.16 at 10:11 pm

Humans are not ready for globalism. Not until they develop mind reading skills like on Nictonite.

It’s pumped into young kids minds all the way up to university.

Ying needs Yang to keep it honest. Take one away, don’t matter which one.

Will be hell on earth.

Absolute power breeds absolute tyranny. It’s human nature. You heathens not ready.

Wake up lefties. Naw, stay sleeping, enough Deplorables to keep things in balance.

Thank God for orange plasma fliers and presidents.

#90 Smoking Man on 12.11.16 at 10:14 pm

#84 UBC Andy on 12.11.16 at 10:00 pm
Hey smoking man, quite obvious ur the smartest alien that posts on this blog, besides u making huge money on forex trading what do you else invest in? Thx
..

Best investment you can make in your life is your self esteem.

Never sell it short.

Dr Smoking Man
PhD Herdonomics

#91 WaitingOnTheWorldToChange on 12.11.16 at 10:14 pm

#56…debtslavecreator….”This cannot and will not end well for millions of Canadians in the next 2-3 years if the US bond yields rise anywhere near the 4-6 % on the 10 year note as Gundlach and several other star money managers expect”

So what do you think happens to all of those Treasuries sitting on the Fed’s balance sheet from QE? Can the US central bank afford to pay that kind of yield?

#92 Fleabitten Monkey on 12.11.16 at 10:17 pm

According to a globe and mail article dec 10 a realtor who runs snap stats says sales to list ratio in east Vancouver is 12 percent this past November. Last November (2015) the ratio was 51 percent. Wow….and ouch.

#93 common sense on 12.11.16 at 10:24 pm

bump

#94 Hotdogs from Heaven on 12.11.16 at 10:28 pm

OPEC has just announced even bigger oil production cuts with Russia.

Prices now expected to hit roughly $60/barrel.

Bond prices fall again in anticipation of even higher inflation globally.

This should also add 50,000 or so jobs to the U.S. energy sector in 2017, just in case you needed something else to stimulate their economy and reduce the unemployment numbers even more.

Interest rates are going up up up.

#95 Hotdogs from Heaven on 12.11.16 at 10:32 pm

#80 Mike on 12.11.16 at 9:39 pm
Can someone explain why Edmonton and Calgary Single family homes are down so little in face of severe layoffs.

Nothing can stop Canadian real estate going up and up.
—————————————————-
Sure. Unlike most areas of Canada, Alberta’s oil industry reliant on tens of thousands of labourers from the rest of Canada. When times got tough they got out and headed back home.

Most were renters and that has had a very negative impact on the landlords it has had much less impact on housing prices since they were neither buyers nor sellers of real estate.

#96 Smoking Man on 12.11.16 at 10:36 pm

Finaly got my turn on the Karoke thinG. I Go With This.

I swapped out super man for smoking Man. It worked, standing ovation from my small family.
Smokers Voice.
. . . . .

Tarzan wasn’t a ladies man
He’d just come along and scoop ’em
Up under his arm like that
Quick as a cat, in the jungle
Clark Kent, now there was a real gent
He would not be caught sittin’ around in no jungle scape
Dumb as an ape, doin’ nothing
Smoking man never made any money
Savin’ the world from Solomon Grundy
And sometimes I despair
The world will never see another man like him
Hey Bob, Supe had a straight job
Even though he coulda smashed through
Any bank in the United States
He had the strength but he would not
Folks said his family were all dead
Planet crumbled, but Smoking man he forced himself
To carry on, forget Nictonite , and keep goin’
Smoking man never made any money
Savin’ the world from Solomon Grundy
And sometimes I despair
The world

The fake Russan Song.

https://youtu.be/nmlVeaL_pLg

#97 Shanghai Sharon on 12.11.16 at 10:37 pm

#54 FC , I just came from Taipei where the transport system indeed makes TO look like a third world joke. Even where I live, BKK , the system is so far more advanced than anything Canada has to offer surely the jokes on you Canadians for forking over half your pay to get nothing but overplayed civil serpants in return. Btw…the subway in Taipei cost me 25 cents to ride.

I roared recently when Vancouvers vaunted Skytrain was stopped due to heavy rain…when nit too long ago it stopped due to overheating on a warm day. Btw…the trains in Asia are twenty or more cars long….Vancouver…3. What a joke on the taxpayer when civil servants are paid in the hundreds of thousands a year according to the sunshine list.

#98 Happy Housing Crash Everyone! on 12.11.16 at 10:39 pm

Brapp on 12.11.16 at 4:48 pm
It’s the families using there HELOC to pay off there bills every year is what I’m curious to see what happens. I know lots of couples that have maxed out there LOC, only to have there house go up in value, remortgage and go again (get out of debt free card). That party will soon finally be over..
____________________________________________

HELOC’s and LOC have payed a huge roll in keeping this housing Ponzi from imploding. With prices falling that game can not be played any longer. Happy Housing Crash Everyone! :-)

#99 Happy Housing Crash Everyone! on 12.11.16 at 10:43 pm

WaitingOnTheWorldToChange

You Realtors advertise outright lies which the media reports without question. The fact is if the government forces you proven liars to open up MLS.ca then all your lies and fake stats will be exposed. Plus your services would become useless overnight since realtors offer zero value. Tic toc before you go the way of travel agents. Happy Housing Crash Everyone! :-)

#100 bdwy sktrn on 12.11.16 at 10:53 pm

#82 a man about a dog on 12.11.16 at 9:41 pm

Doesn’t matter what people do with their money just that they do something with it.
———————-
again myob you filthy communist.

earn your own damn money, leave mine alone.
try education, entrepreneurship of just plain hard work.

#101 bdwy sktrn on 12.11.16 at 10:58 pm

#76 Context on 12.11.16 at 9:24 pm
…. a huge space rocket by guess who? No, not by Canada, but JAPAN.
——————-
wow, thats fascinating information. you are so clever to know all this cool stuff. you rock.

…..
japan launches to ISS:
2009,2011, 2012, 2013, 2015,2016.

—————-
stick to grossing out younger cougars, you creepy old bastard.

#102 RIL on 12.11.16 at 11:02 pm

# 80 Mike – YYC and YEG SFHs hold steady despite severe job losses. Why?
;$;$;$

I have advanced my point of view (uninitiated) here at least three times and invited correction and illumination without success. Let me state it again. The so-called average “price” is in fact the average transaction value. The $580K average in Calgary this month is what people are spending on a SFH. Are they acquiring last year’s $700K house? I suspect so.

#103 a man about a dog on 12.11.16 at 11:03 pm

#81 When Will They Raise Rates? on 12.11.16 at 9:40 pm

Why should the state have the ability to force its citizens to do anything? Do you believe that Canada should be a free country, or would you prefer to live in North Korea? If so, why don’t you move there?
________________

I guess speed limits, seat belts and taxes piss you off too? Maybe we should send you to North Korea so you realize what a dipshit argument that is to make. It’s called a false dichotomy and there’s a world of difference between what’s being discussed and North Korea. Thinking is hard though, right?

This steerage section really is an uneducated, deplorable class.

#104 Smoking Man on 12.11.16 at 11:03 pm

Every time Lesa Laflam on the tube I go for this one.

https://youtu.be/nmlVeaL_pLg

#105 Smoking Man on 12.11.16 at 11:05 pm

I ment this one

https://youtu.be/xvaEJzoaYZk

#106 fishman on 12.11.16 at 11:05 pm

The “better” restaurants in Van are full & booked for 2016. A R/E “business dinner” of a half dozen professionals & part timers feted $ lubricated runs around $2200. Average for this town.
Sub prime lenders (independents} are pulling their money out as their short term notes come due. Not going back in. The deals coming in have increased from trickle to flood in the last year. Finance Companies busy beyond belief.
First exit strategy is to pick out a property one could build & live in before giving that 2nd in case you have to eat the 1st. A juicy teardown came out on the west side in Aug at 2.6mil. Now its 2.4mil. We’re watching this one cause its a keeper. Almost 4 months & still hasn’t gone. Builders are running for cover.
Second exit strategy of just putting it out there on market looking more tenuous. Lots more For Sales with no Sold; thats recent.
Noise that Chinese dudes aren’t to impressed with 1% cap rates on tired high upkeep commercial properties. Their taking a liking to better returns across the line.
Vancouver Island still popping. White Boomers running for “safe zones”.
The lumber industry going down when congress puts the kibosh on softwood. Interior mills will take 60% of the Canadian hit. World of hurt for one industry small mill towns.
Uncle Garth’s call for a slow meltdown looking pretty good. Forecast: steady, trending to increasing pain for the wet coast in 2017.

#107 Vancouver's bubble is special on 12.11.16 at 11:07 pm

http://www.cbc.ca/news/canada/british-columbia/vancouver-s-housing-bubble-risk-unmatched-on-the-planet-says-swiss-bank-1.3781527

We’re the best bubble ever!

#108 bdwy sktrn on 12.11.16 at 11:10 pm

I roared recently when Vancouvers vaunted Skytrain was stopped due to heavy rain…when nit too long ago it stopped due to overheating on a warm day. Btw…the trains in Asia are twenty or more cars long….Vancouver…3
———————-
so this must be why there is a never-ending flood on humanity moving from van to asia? thx for that.

i took the trains in tokyo every day for a year(JR line, shinjuku to youkohama) , skytrain comes way more frequently.

#109 bdwy sktrn on 12.11.16 at 11:11 pm

“yokohama”

#110 will on 12.11.16 at 11:12 pm

Re: paper cash

Splitting hairs here I know but actually the cash now is all “poly”. There is still paper around I guess that has not been collected and retired but most is poly-cash. We have this interesting cash counting machine where I work that counts cash by weight. You put a handful of twenty’s on it and it counts them by the weight. Interesting technology to be that sensitive and accurate.

#111 bdwy sktrn on 12.11.16 at 11:25 pm

#105 Vancouver’s bubble is special on 12.11.16 at 11:07 pm
http://www.cbc.ca/news/canada/british-columbia/vancouver-s-housing-bubble-risk-unmatched-on-the-planet-says-swiss-bank-1.3781527……

The 2016 UBS report says Vancouver’s housing has been overpriced since 2007 but has gone into “overdrive” in the past two years due to strong demand among foreign investors

#112 MissConstrued on 12.11.16 at 11:28 pm

Can we make fun of these people now?

http://www.theglobeandmail.com/globe-investor/personal-finance/genymoney/how-six-canadian-families-are-coping-with-the-high-cost-of-homeownership/article33279549/?service=mobile

#113 a man about a dog on 12.11.16 at 11:29 pm

#99 bdwy sktrn on 12.11.16 at 10:53 pm
again myob you filthy communist.

earn your own damn money, leave mine alone.
try education, entrepreneurship of just plain hard work.
_______________________

Ad hominem attacks really seem to be the theme of the night. Guess I can’t expect much intelligence from the deplorables on this blog.

Try thinking, even if it is just plain hard work.

#114 bdwy sktrn on 12.11.16 at 11:41 pm

Try thinking, even if it is just plain hard work.
—————–
think about not being a leech on society.

you want to f with other peoples property – what else are you but a commie sponging loser?

EARN YOUR OWN.

#115 RIL on 12.11.16 at 11:45 pm

I was not very artful in expressing my question above. Let me put it another way. Suppose every year from ’08 to ’16, you bought a YVR house for $1.2 MM. Each year you got a lousier house.

You also spent $1000 each year on a TV. Each year watching the Flames was more enjoyable on a bigger and better idiot box.

The average price remained the same.

#116 For those about to flop... on 12.12.16 at 12:00 am

David Beckham and his annoying wife are looking to blow $200 million on this Californian mansion.

It has 27 bathrooms.

What a “waste”…

M42BC

http://www.dailystar.co.uk/showbiz/569242/Beckham-David-Victoria-set-sights-California-palace-mansion-house-Harper-Cruz-Brooklyn

#117 Jon B on 12.12.16 at 12:02 am

I check in every now and then with the local cartel’s real estate listings just to stay in touch with the price points in certain hoods in downtown Vancouver. We’re still in noise bleed territory. I mean, it’s just incredible. Obviously everyone is rich.

#118 For those about to flop... on 12.12.16 at 12:07 am

common sense on 12.11.16 at 10:24 pm
bump
//////////////////////////

We got rid of the “firsters”and then picked up a bunch of ” bumpers”…

M42BC

P.s. Who is going to go over to OLCs house in Goderich and dig it out of the snow?

#119 RIL on 12.12.16 at 12:14 am

Garth:

If I may. Thanks.

This lefty, anti-globalist, anti-free trade populist recognizes one benefit to our having off shored all our jobs and manufacturing. We also off shored a huge amount of our pollution. I suspect there are still some cricks, streams and rivers in Ontario that you can still drink from. Not so much in China.

Andrew Woburn, good link.

#120 Freedom First on 12.12.16 at 12:21 am

#24 a man about a dog

Yes. Thanks. I used to have some empathy for the younger generations. But after reading and hearing so many demented comments like yours, I am over it.

#1
Freedom First
Master of Freedomonics

#121 Mark on 12.12.16 at 12:40 am

“Can someone explain why Edmonton and Calgary Single family homes are down so little in face of severe layoffs.”

In a nutshell, the sales mix. The layoffs and income reductions in Edmonton/Calgary are not of people earning relatively little, but rather, of people earning a lot. When they sell their houses (or bid to buy different ones!), they’re selling (or buying) at the higher percentiles of the market, thus offsetting the price declines seen systemically. So transactions have disproportionately shifted to this part of the market in the overall mix. On individual housing units in Edmonton, prices are beneath the 2007 peak. In Calgary, prices are now down ~20% from the 2011 peak.

Similar impact of a shifting mix seen in Vancouver/Toronto, although those cities peaked in 2013, were driven more by heavy use of subprime credit, and have been subject to stagnation and slight falls on identical units.

THAT is decidedly not the problem since all the those 30 year mortgages in America are open from the very start.

I think you’ll have to dig into the sort of participation that Fannie Mae/Freddie Mac provides into the market for a more thorough explanation of why there’s that difference. Additionally, the US banks that hold the long-term paper are in for severe losses as long-term interest rates rise, for obvious reasons. I’ve tried to discuss this in the past, especially the severely negative impact on the US FIRE sector that rising rates will have. But have taken a lot of highly undeserved flack for pointing out that higher rates are a sort of “kryptonite” (to use a Superman metaphor) to the US banking system. In a nutshell, the US banks are comfortable taking higher profits in the falling rate environment, but having their balance sheets destroyed and falling into insolvency in the rising rate environment. Canadian banks strive to achieve sustainability over the full long-term interest rate cycle. Give me the Canadian system any day of the week over that of the US system!

#122 Freedom First on 12.12.16 at 12:57 am

#90 Smoking Man

Best investment you can make in life is your self esteem.
……………………………………………………………………………….
Yes. I agree. With an addendum:
” Better to give a resentment than to keep one”

#1
Freedom First
Master of Freedomonics

#123 Context on 12.12.16 at 1:20 am

#100 bdwy sktrn:- I am aware of those launches but my hidden point was threefold for those that can think out of the box. First there was no coverage on MSM as there should have been. Secondly, there must have been a dire emergency as it was a quick launch that was covered in Japan. Thirdly, am now beginning to suspect Japan might just have nukes. Now will tell you a story that few knew about that took place during the gulf oil disaster. BP oil considered the option of using a mini nuke to seal the wellhead and turned to our major base in Alberta who began to prepare one for them and that was a surprise. Now if you ever used your fowl language to me in person it would be curtains for you, so grow up.

#124 When Will They Raise Rates? on 12.12.16 at 3:35 am

f) anyone who likes the ability to have a garage sale, sell something on Kijiji, loan a friend a couple hundred bucks, have a bake sale, or even let their kid run a lemonaid stand – without needing a debit machine, or some other 3rd party involved.

#125 When Will They Raise Rates? on 12.12.16 at 3:44 am

g) anyone who doesn’t want their private consumption data being mined, expolited, bought and sold by private companies. – see Doug’s post yesterday.

#126 When Will They Raise Rates? on 12.12.16 at 3:49 am

h) anyone who doesn’t want the government to have the ability to block him/her from buying food, clothes, shelter, or anything, by simply freezing a bank account.

#127 When Will They Raise Rates? on 12.12.16 at 3:51 am

i) anyone who doesn’t trust the government, and didn’t vote for them.

#128 When Will They Raise Rates? on 12.12.16 at 3:54 am

j) anyone who values their own freedom.

#129 When Will They Raise Rates? on 12.12.16 at 4:28 am

#102 a man about a dog on 12.11.16 at 11:03 pm

#81 When Will They Raise Rates? on 12.11.16 at 9:40 pm

Why should the state have the ability to force its citizens to do anything? Do you believe that Canada should be a free country, or would you prefer to live in North Korea? If so, why don’t you move there?
________________

I guess speed limits, seat belts and taxes piss you off too? Maybe we should send you to North Korea so you realize what a dipshit argument that is to make. It’s called a false dichotomy and there’s a world of difference between what’s being discussed and North Korea. Thinking is hard though, right?

This steerage section really is an uneducated, deplorable class.
———————

Bravo, that’s some world class trolling right there… Either that, or you’re a full-blown, unabashed statist, suffering from delusions that central planners are both omnipotent and benevolent.

Yes, thinking is hard. I gave you 10 reasons why someone with a room temperature IQ would oppose a cashless society. Feel free to counter. It will however, require thinking.

#130 Shanghai Sharon on 12.12.16 at 5:04 am

#106 BST , it’s a fact that the poorest in Asia want to get out…and the corrupt in China need to get out…Canada is an easy mark for bogus claims and exemptions….known world wide for this. But….there is no rush of Asia’s educated middle class to emigrate to Canada. The quality of life is very much higher in Bangkok than Vancouver.

If you’re making middle class money here …and its better than Canadian private sector rates…( with the exception of China….because its such a bung hole most expats …even those well paid…expect hardship pay to stay and there is a huge turnover due to the bung hole aspects of the crappy filthy ignorant rude crude lifestyle in PRC) life is very good for the rapidly expanding middle class who have western incomes and near zero taxes where living costs a quarter of what it would in Canada.

Ask any Thai, Malaysian, Singaporean , Indonesian middle manager or business owner. Canada is definitely not attracting the top of the heap, unless you are looking for the most expensive uneducated immigrants who need welfare for generations.

Japan is a special case, although modern , and the people aren’t a holes like China….India…you are hard pressed to get expats to stay longer than a two or three year contract….Japan is a love hate thing.

#131 WaitingOnTheWorldToChange on 12.12.16 at 6:57 am

#98….HappyHousingCrash

“WaitingOnTheWorldToChange

You Realtors advertise outright lies which the media reports without question. The fact is if the government forces you proven liars to open up MLS.ca then all your lies and fake stats will be exposed. Plus your services would become useless overnight since realtors offer zero value. Tic toc before you go the way of travel agents. Happy Housing Crash Everyone! :-)

You sound like the doomer conspiracy theorists that Garth loves to slag. Probably a bullion licker too.

#132 Oakville Sucks on 12.12.16 at 7:13 am

Did anyone catch another CBC Radio Business segment with Michael Halinka??? More nonsense from the CBC. He obviously doesn’t read greaterfool. The markets are now slightly leaning towards a interest rate hike+ rubbish rubbish rubbish… Trump is obviously a big thorn in communist broadcasting corporations Side.

#133 maxx on 12.12.16 at 8:02 am

#2 Pete on 12.11.16 at 3:50 pm

“Going to be a bad year for everyone in the real estate market. With sales tanking alone with prices it doesnt look good. Word is GTA sales have just stopped and no its not because of the time of year. Its getting ugly out there. Don’t believe realtor lies.”

No segment of the economy deserves a good few really lean decades as much as this manipulative bunch- with a perfect view on the way down, just as they crafted for the public, with prices relentlessly and artificially pushing upward for the past 30-odd years.

The realtard cartel was greatly aided by tptb and now that it is widely recognized that this was a huge mistake, the tide is finally turning. Re-balancing the economy and restoring value to money is job one.

Sell now or sell never, and watch those paper gains melt away and disappear- for what’s left of the time that counts.

#134 crowdedelevatorfartz on 12.12.16 at 8:20 am

@#114 Flopster
“David Beckham and his annoying wife”
********************************************
No arguement there.
27 bedrooms eh?
Perhaps he can open a tattoo parlor in one of those bedrooms so he can get a discount on what ever availabe “un-inked” portion of his body he has left.
( his brain? bwahahahaha, just kidding. He doesnt have one)
OR
Perhaps she can open a plastic surgery office in one of the other bedrooms to get a discount on what miniscule portion of her body she hasnt altered, nipped, tucked, folded or enhanced
The Beckams. A washed up hasbeen and an aging bimbo (you folks get to decide which is witch)
Proof that even british trailer trash can eventually perculate to the top of the food chain if they have enough money.

#135 Woke To The Sounds Of Horking on 12.12.16 at 8:31 am

#128 Shanghai Sharona

M-m-m-My Sharona, you sound like an abominable person. I hope we never meet. Promise us you won’t come back to Canaduh.

As if BKK has a better quality of life than Van! The air quality sucks in Bangkok. So does the traffic. So does the drinking water. Plus, Thais have a special, burnished hatred (okay, okay, let’s call it a “dislike,” fine) for farang (foreigners).

Van sucks the big one too, compared to, say, Montreal, but at least you’ve got the fundamentals in Van — like oxygen.

But you’re right: No one mildly wealthy in Malaysia, Singapore, Indonesia or Thailand would ever dream of moving to Canaduh.

Canaduh attracts both the hopeless and the wealthy. And that is why Canaduh is so interesting.

#136 BillyBob on 12.12.16 at 8:47 am

#72 bdwy sktrn on 12.11.16 at 9:12 pm
Rebalancing provides consistent profit harvesting. Try rebalancing your house. — Garth
——————
well that would have been a very big mistake for the past 15 yrs in to/van (at least till this spring in 604)

i considered selling house when i started reading this blog, i did not sell, and would have missed almost exactly a mil (tax free) if i had.

keep paid off RE for ever – never sell it.

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

Trying to understand, then, how that “extra mil (tax free)” is in your pocket if you don’t sell it? lol

You can’t have it both ways. You haven’t “made” a dime, and from the sounds of it, you never will. Or you’ll be like most Canadians, and wait until prices start to drop before selling lol.

#99 bdwy sktrn on 12.11.16 at 10:53 pm
again myob you filthy communist.

earn your own damn money, leave mine alone.
try education, entrepreneurship of just plain hard work.

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

And no doubt you attribute the paper increase in value of your crappy home in some suburban hell-hole to your “entrepreneurship or hard work”. Geezuz some people need to get over themselves? What’s with the carpet-bombing of the comments? I stopped keeping track after about the 10th spew. Defensive much?

As a resident of Taipei, I can verify Shanghai Sharon’s comments about things like public transit – the MTR in Taipei City makes Vancouver look the hillbillies they truly are.

Keep pumpin’ that bubble in YVR – it won’t change the fact that you actually have to live there…

#137 };-) aka Devil's Advocate on 12.12.16 at 8:50 am

If ‘ifs’ and ‘buts’ were candy and nuts we’d all have a good Christmas.

I expect next year will be much like last year and the year before that and the year before that…

The market is what the market is.

He who hesitates is lost.

While all you suckers were waiting over the last 8 years for the market to tank others were enjoying sweet equity gains. I know, I know… you think all that’s coming to an end and those who profited will soon meet their demise. Yup, I’m sure, and how has that worked out for you so far?

The only certain thing is death and that this wild ride is ultimately unsustainable but we’ll keep kicking the can down the road for as long as we can and there is more incentive and a greater number wanting to do that than sit on their fat asses waiting for economic armageddon. I think I’ll follow the crowd. At least their doing something productive.

SHIFT happens, learn to ride the tide.

};-)

#138 Vanrentor on 12.12.16 at 8:53 am

Doomsday Scenario

http://business.financialpost.com/personal-finance/the-doomsday-scenario-why-youre-more-tied-to-real-estate-than-you-think-and-what-you-can-do-about-it

#139 traderJim on 12.12.16 at 8:59 am

Loonie’s killin me, I’ve given back $20k in two days. Ugggh.

On a different note: Can’t believe some people seem to think that money npot being spent is somehow wasted.

Very little cash is stuffed into mattresses, it’s saved in banks, who lend it out to smart people running businesses or schmucks buying McMansions.

The idea that the more we spend the richer we are seems to be pervasive. *shakes head*

I also heard that 80% of people believe in ghosts so I shouldn’t be surprised I guess.

#140 traderJim on 12.12.16 at 9:07 am

On a happier note, excellent steak dinner for two with bottle of wine at lakefront restaurant just outside of Medellin, Colombia: $35

Colombia’s getting a bit dangerous again, but cost of living is very attractive mostly thanks to a falling peso.

You can even find trendy health food restaurants in the major cities. Large cappucino in a fancy cafe is $1.50.

Probably wouldn’t retire here but nice place to spend the winter.

#141 lying entropy mark the fake engineer on 12.12.16 at 9:23 am

119 Mark 
In a nutshell, the sales mix.
____
Still no data, links or evidence , 3 years later

Entropy mark feels hollow inside.

#142 Alberta Ed on 12.12.16 at 9:26 am

Nutley’s new carbon tax is going to sting all those strapped mortgage slaves. The payback when the next election rolls around will be interesting.

#143 bdy sktn on 12.12.16 at 9:35 am

121 old man,
used your fowl language to me in person it would be curtains
___________
It’s penny henny with the fowl language.
And enough with the threats of “assault with a walker”
Creepy old dude . Creepy.

#144 Sonny on 12.12.16 at 9:36 am

Interest rates are about to rise south of the border — and Canadians will feel it

http://www.cbc.ca/news/business/monetary-policy-divergence-1.3887829

#145 Capt. Serious on 12.12.16 at 9:44 am

#6 Andrew Woburn

Interesting read. Makes a lot of sense.

#146 Penny Henny on 12.12.16 at 9:48 am

Today’s picture.
My wife was a flight attendant and one day the dog chewed up and ate part of her passport.
This went unnoticed until she was getting ready for work one day and had to phone in to work and book off the flight. I don’t think they believed her.
Too funny!

#147 Alex G. on 12.12.16 at 10:56 am

@ #86 23.3% on 12.11.16 at 10:03 pm

Nope, you would just sell the excess of your top performers (in this example let’s say it’s the S&P 500 and the TSX) until they are back to your pre-determined weightings of whatever you deem appropriate.

Let’s say that in the meantime preferreds have under-performed, as have bonds, and some internationals. Just buy those since they now represent a lower % of your portfolio than they initially were meant to represent.

In due course, some of those may outperform the S&P or the TSX, and then you sell those and buy back the losers, always maintaining your % ratios.

That’s what rebalancing is all about… always sell high and buy low. No need to market time, your portfolio will tell you when to do what based on your assigned % compared to what the original weightings were, without listening to the figureheads and “experts” on TV predicting the next crash or boom.

Hope this helps,
Alex

#148 Penny Henny on 12.12.16 at 11:36 am

121 old man,
used your fowl language to me in person it would be curtains
___________
It’s penny henny with the fowl language.
And enough with the threats of “assault with a walker”
Creepy old dude . Creepy.
////////////////////////////////////////

Cluck, cluck. Creepy Old Man.
Riddle me this Context. Why don’t you disappear for a couple of years like you did before when your blog name was Old Man?

#149 Lillooet, BC on 12.12.16 at 11:47 am

Bram on 12.11.16 at 4:04 pm
The year will be history in a couple of weeks.

Maybe time to rate our host’s 2016 predictions?
http://www.greaterfool.ca/2016/01/01/el-predicto-3/

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

A few other points:

RE in Vancouver and Toronto?
Forgot those surveys?
Canadian election?
US election?
US interest rate?

But it is known to all that “to err is human”.
I still like our host’s priceless work!

#150 Ponzius Pilatus on 12.12.16 at 11:49 am

The dream of the globalist elite was once to create a borderless society. Go anywhere without a passport.
No one knows, but we may need a passport to leave our house in the future.
I guess there’s material for a book and movie here.
Or just remake 1984.
I just love Philosophers and Writers.
Kick out the MBAs and bring back humanities in our Universities.

#151 Ponzius Pilatus on 12.12.16 at 11:51 am

MBA, what is it good for?
Absolutely nothing.

#152 L Decaperio on 12.12.16 at 11:54 am

#133 Woke To The Sounds Of Horking on 12.12.16 at 8:31 am
M-m-m-My Sharona, you sound like an abominable person. I hope we never meet. Promise us you won’t come back to Canaduh.

As if BKK has a better quality of life than Van! The air quality sucks in Bangkok. So does the traffic. So does the drinking water. Plus, Thais have a special, burnished hatred (okay, okay, let’s call it a “dislike,” fine) for farang (foreigners).”

Would take BKK over the dreadfully boring and rainy YVR any day. Food, culture, beaches, weather, people, shopping, cost of living, lifestyle, regional travel…..sorry getting tired of typing.

#153 Ponzius Pilatus on 12.12.16 at 11:59 am

Talking about soccer.
Corruption and tax evasion is rampart in European Soccer again.
Cue, Vancouver RE.
Still love the game, though.
But the MLS is like Junior hockey.
Awful game in Toronto the other night.

#154 TurnerNation on 12.12.16 at 12:04 pm

Okay boys see y’all at TSX 16,000 and oil $60.

#155 TurnerNation on 12.12.16 at 12:10 pm

Kanada is hostile climate to women. Get to work !

Our elite rich selfie PM is unaffected.

http://www.cbc.ca/news/business/child-care-costs-1.3888199

#156 dm in c on 12.12.16 at 12:15 pm

Just renewed two weeks ago, three months early, no penalty. Scotiabank.

Went in with an emailed offer of 2.7, she lowered it to 2.5 in the office. For the 5 year rate. Kept the payments the same, diff is going on the principal.

#157 Damifino on 12.12.16 at 12:26 pm

#72 bdwy sktrn

i considered selling house when i started reading this blog, i did not sell, and would have missed almost exactly a mil (tax free) if i had.
—————————————

I did what Garth says few people do. That is, I lived in the same Vancouver house for 25 years. I sold it in 2010 for 7.3 times what I paid (after commission). That’s about an 8% per year gain on average:

((25th root of 7.3) – 1) * 100% = 8%

Of course, I had to pay mortgage interest for a large part of that time but I didn’t have to pay rent either. I also had the other usual costs associated with home ownership but it was just a cheap 1950’s bungalow which I kept functional, but not in the least bit fancy.

Three years after I retired, I sold the house for lot value and found myself sitting on a large pile of tax-free cash. I thought I would “downsize” and went shopping for a condo. After a week I came to the obvious conclusion there was nothing but overpriced crap available in an insane market that I thought was in danger of imminent collapse.

It was then I started to read this blog. I realized I’d won the lottery and was on the verge of risking it all in one huge, non-diversified lump.

Instead, I invested as per Garth. Since then I’ve earned an average of 6% per year of real money that I use to live on (together with CPP, and now, OAS). My principle remains fully intact and my income taxes are fairly low.

I live in high-end yet still rent controlled apartment downtown that would have (until recently, I suppose) cost about $1.2M to buy. I pay in rent about half of what it would cost me to own. It’s a purpose built rental with commercial space on the bottom floor which is all under professional management. I don’t even know who the owner is. I only deal with the manager and we get along just fine.

I’ve never looked back. The idea of owning residential real estate now makes me rather queasy.

#158 JJ on 12.12.16 at 12:45 pm

#46 Winterpeg
So my house will fetch a lower price next Spring?
Or is there still a window of opportunity?
(Winnipeg market, which has been mixed this fall)

I’m thinking about buying a house in Winnipeg this spring. I’ve been casually looking for years. In my observation, house prices have not really moved since 2013. Maybe up a couple percentage points. You can still buy nice houses in good neighborhoods for $260,000 – $310,000 (my price range). In cheaper neighborhoods like Elmwood and the West End, under $200,000 is still possible.

I can’t really see a “housing crash” here, even with all the new building. People can afford houses and will just buy when they are ready. There is no speculating going on. My prediction is that prices continue to just go nowhere for many years as interest rates rise. Maybe Garth has a comment on that?

#159 bdwy sktrn on 12.12.16 at 12:52 pm

#136 Vanrentor on 12.12.16 at 8:53 am
Doomsday Scenario

http://business.financialpost.com/personal-finance/the-doomsday-scenario-why-youre-more-tied-to-real-estate-than-you-think-and-what-you-can-do-about-it
—————————

“…a long list of worries if we face a major house price decline. These would likely include:

Your investment portfolio would be hit hard if you own Canadian Bank Stocks, Canadian REITs, Canadian Mortgage and Mortgage Insurer stocks.”

and

“important to have meaningful investment exposure outside of Canada or at least outside of Canadian Financials, mortgage funds and REITs. We see too many people that believe that these sectors are bullet proof, but unfortunately they are layering on added risk to their large personal Canadian real estate exposure”

#160 Ronaldo on 12.12.16 at 12:55 pm

Driverless trucks in the oil sands is next. This is already being done in Australia with control centers hundreds of miles from the operation. Welcome to the world of technology.

http://www.cbc.ca/news/canada/edmonton/oilsands-workers-worry-driverless-trucks-will-haul-away-their-jobs-1.3832921

#161 bdwy sktrn on 12.12.16 at 1:03 pm

#154 dm in c on 12.12.16 at 12:15 pm
Just renewed two weeks ago, three months early, no penalty. Scotiabank.

Went in with an emailed offer of 2.7, she lowered it to 2.5 in the office. For the 5 year rate. Kept the payments the same, diff is going on the principal.
——————-
oh, the horror!

#162 maxx on 12.12.16 at 1:10 pm

#24 a man about a dog on 12.11.16 at 5:10 pm

“Who doesn’t like the idea of a cashless society? We have the boomers sitting on huge amounts of cash and overly generous pensions who will penny pinch right into their twilight years forcing the economy into deflation.

Force them to spend it, invest it, do something with it. Isn’t holding cash or even gold an inefficient use of capital? I don’t see the downside here can somebody help me out?”

Help you out? Nope.
Force? It’s been tried and failed miserably. “Inefficiency”, as you call it, is not a tool for the likes of you to justify employing viciously against another generation.
Your economic problems are not unique. Many, if not most boomers scratched like hell to get where they are and they’ll damned well do as they please with their wealth, whether or not it pleases you.
You’d do the very same, if you had the wherewithal.
You sound like a pathetic beggar.

#163 Self Directed on 12.12.16 at 1:27 pm

#96 Shanghai Sharon on 12.11.16 at 10:37 pm

Vancouver never used 3 cars… always multiples of 2. We are up to 6! 6 whole cars.

You JUST figured out now that Canada was expensive. Sorry. Old news. I hope you enjoy Bangkok.

#164 Vlad to destroyer on 12.12.16 at 1:34 pm

Looks like we are going to have some fun, comrades.

http://www.msnbc.com/tamron-hall/watch/trump-openly-disputes-cia-over-russian-hacking-830931523864

#165 Vlad to destroyer on 12.12.16 at 1:34 pm

Even 21st century Goebbels would like the story buried

http://www.msnbc.com/andrea-mitchell-reports/watch/conway-cia-fbi-need-to-get-over-hacking-830972483930

#166 Vlad to destroyer on 12.12.16 at 1:36 pm

Even the turtle wants this looked into

http://www.nbcnews.com/politics/congress/sen-mcconnell-backs-senate-investigations-russian-breach-n694876

#167 bdwy sktrn on 12.12.16 at 1:38 pm

bkk?

http://aqicn.org/city/bangkok/

https://www.google.ca/search?q=bangkok+air&source=lnms&tbm=isch&sa=X&ved=0ahUKEwiPvND_oe_QAhVQ82MKHYCNAKUQ_AUICSgC&biw=1745&bih=864#tbm=isch&q=bangkok+air+quality&imgrc=_

there are a few thousand beach towns i’ll visit before going back to see that brown air again. (good for cheap custom suits though)

ps : the new upscale thai place on the drive has the best thai food i’ve seen anywhere. it ain’t cheap but it’s mindblowing. (kin kao – for you 604 foodies)

#168 maxx on 12.12.16 at 1:44 pm

#36 crowdedelevatorfartz on 12.11.16 at 5:49 pm

@#33 Awesome Realturd

“Sorry but after reading all your spelling and grammatical errors …..
I think the Real Estate Association should be vetting people for integrity AND intelligence.
I can dream cant I?”

LOL! You can dream, but remember, stupid can’t be fixed- that’s why they’re called realtards. The smart ones move ahead to more challenging pastures.

#169 Damifino on 12.12.16 at 1:51 pm

Isn’t holding cash or even gold an inefficient use of capital? I don’t see the downside here can somebody help me out?”
——————————–

I was never talking about ‘hoarding cash’. I was talking about PAYING WITH CASH.

For some things, that is. Obviously, I won’t be paying cash for a new car. But I will always want to pay cash for a hot chocolate at Starbucks.

Do you not get it? I don’t feel the need for a paper trail (or, more accurately an ‘electron trail’) following every minor transaction made in the world.

Please keep that snoopy microscope away from my wallet. It is of no benefit to me. Only to data parasites who want to gather free information for their own profit.

#170 Leo Trollstoy on 12.12.16 at 2:10 pm

Similar impact of a shifting mix seen in Vancouver/Toronto, although those cities peaked in 2013

Just FYI for the uninitiated, this is false. No evidence that sales mix affecting prices and no evidence prices peaked. Evidence shows the opposite, that Toronto prices continue to rise.

Ask for evidence of sales mix and peak price and poster will 1) state that evidence is already “out there”, 2) claim victim of trolling, 3) cease further discussion

Predictable. Just helping new readers out! Your welcome!

#171 Leo Trollstoy on 12.12.16 at 2:12 pm

#139 lying entropy mark the fake engineer on 12.12.16 at 9:23 am
119 Mark
In a nutshell, the sales mix.
____
Still no data, links or evidence , 3 years later

Entropy mark feels hollow inside.

Rats someone beat me to it. Cue the citing of evidence “already out there”, crying of being the victim of trolling, cease further discussion. In no particular order.

My predictions are always spot on

#172 Euro observer on 12.12.16 at 2:17 pm

“Can someone explain why Edmonton and Calgary Single family homes are down so little in face of severe layoffs.”

Calgary is 3 times less expensive than Toronto.
Oil is going up again.

Prices in GTA, pretty much unlivable/non-drive-able/ nothing to do type of city with mediocre entertainment, non-pleasant weather are an enigma to me.

Considering the quality of the buildings, the quality of house construction as well as incomes I would say et least 3 times overpriced. Maybe more.

But my Canadian friends never stop to surprise me.

#173 Polls R Phake on 12.12.16 at 3:08 pm

Rigged markets need to look no further than oil. Are you kidding me ? $53? There is a gigantic glut in oil. Thousands of tankers are floating around the ocean with no place to go. Not to mention a drop in demand, better fuel economies, electric cars etc. Amazing.

#174 IHCTD9 on 12.12.16 at 3:15 pm

Perusing the heavy equipment listings on Kijiji reveals lots of laid off employees have taken little treasures from the plant storeroom with them before punching out for the last time. Other folks are obviously liquidating Company inventory, and equipment either before the inevitable, or as an exercise in raising funds or downsizing. Even scrap dealers are swinging deals reselling the perfectly good inventory Receivers are sending them these days.

Smoking deals on top notch equipment everywhere you look.

#175 jess on 12.12.16 at 3:26 pm

cashless

#10 Andrew Woburn on 12.11.16 at 4:11 pm

would the central bank become the lender of last resort?
Tracking suppliers / transactions should be easier except i heard this tech could replace lawyers ! read project beacon.
=
footballers image rights ….hum think Trump has used the same scheme? He has over 500 LLC’s

Nearly 200 footballers face HMRC probe for using ‘image rights tax dodge’ to cut bills (12 Dec 2016)
Cristiano Ronaldo reveals £191m assets after tax evasion allegations (12 Dec 2016)

“free traders” /”tax shoppers”

Tax Battles: the dangerous race to the bottom on corporate tax, to to be released on Monday, defines a “tax haven” as a low-tax or no-tax nation with generous tax incentives.

http://www.theage.com.au/business/the-economy/bermuda-tops-list-of-worlds-top-tax-havens-according-to-oxfam-20161208-gt6v3n.html

===

#176 jess on 12.12.16 at 3:37 pm

one doesn’t read this in the glossy ad

In B.C., the province that dumps the most untreated waste water into rivers and oceans, the amount rose to 82.3 billion litres in 2015, a 32.7 per cent increase from 2013. From November to December 2015 alone, an estimated 24.8 billion litres of raw sewage were flushed into the Juan de Fuca Strait near Victoria, which recently voted to build a sewage treatment plant.

http://www.cbc.ca/news/politics/sewage-pollution-wastewater-cities-1.3889072

#177 Doug in London on 12.12.16 at 4:14 pm

@Woke To The Sounds Of Horking, post #133:
Have you ever actually been to Bangkok? The air quality wasn’t that bad when I was there, a lot better than what I experienced in Cairo, Naples, or Delhi in the winter months. In Bangkok most if not all of those tuk tuks run on propane rather than gasoline, which cuts emissions. Throughout Thailand I saw many vehicles that run on propane or compressed natural gas. The traffic in Bangkok is bad, but you will find that in a lot of large Asian cities. It could be far worse, but a lot of people travel on the sky train which helps a lot. While in Toronto they argue forever about whether to build a subway or light rail, in Bangkok they got off their asses and built a world class sky train. We could learn a lot from the Thai people about transportation.

As for the people there I didn’t see they had any resentment towards we farang, not at all. That was true throughout Thailand, not just in the capital city. About the worst thing I could say is they were largely ambivalent about we farang. If you there, is it possible that they reacted negatively to the way you interacted with them?

#178 InvestorsFriend on 12.12.16 at 4:49 pm

Rigged Market in Oil

#171 Polls R Phake on 12.12.16 at 3:08 pm exclaimed:

Rigged markets need to look no further than oil. Are you kidding me ? $53? There is a gigantic glut in oil. Thousands of tankers are floating around the ocean with no place to go. Not to mention a drop in demand, better fuel economies, electric cars etc. Amazing.

********************************************
I pity those that complain the stock market is rigged.

But as for oil.

Well yes, OPEC has existed since 1960 and has successfully “rigged” oil prices higher most years since about 1972 through collusion and supply curtailment. In the 1970’s North American complained bitterly about the OPEC cartel and high oil prices.

But the oil producing regions of North America soon realized that they could ride OPECs coat tails to riches.

So, yes indeed oil prices are rigged and the oil industry in North America benefits from it.

Do oil traders also play a role in pushing prices up from time to time? That I really don’t know. They have certainly been accused of (or lauded for) doing this at times.

#179 NoName on 12.12.16 at 5:11 pm

#13 For those about to flop… on 12.11.16 at 4:33 pm
There was some chatter on the blog about society going
cashless and money related stuff and so I will leave this here for currency buffs…

M42BC

https://howmuch.net/articles/33-facts-you-didnt-know-about-us-money

——

Interesting link, but they fail to mention two thing inflation, and only thing that money cant buy, poverty, or it cant. manny lottery winners prime example of it.

How about going time, who knew that time is subject to inflation.

http://www.maximiliankiener.com/digitalprojects/time/

and this
Why Time Goes Faster As You Get Older

https://www.psychologytoday.com/blog/cutting-edge-leadership/201004/why-time-goes-faster-you-get-older

#180 Out of balance, Help?! on 12.12.16 at 5:17 pm

Blog dogs, help?!

I have my majority of investment sitting in cash or fixed income (bonds/preferred) ETFs for years. I started to take Garth’s advice this year, buying TSX, S&P500 and International equity ETFs. But my portfolio is still out of balance Equity:Fixed Income=40:60. What is the best strategy to balance the portfolio? Should I sell some stock ETFs that went up double digits this year, then buy back the next year when rebalancing the portfolio? Waiting for the market to dip a little.

#181 TCContrarian on 12.12.16 at 6:16 pm

#72 bdwy sktrn on 12.11.16 at 9:12 pm
Rebalancing provides consistent profit harvesting. Try rebalancing your house. — Garth
——————
well that would have been a very big mistake for the past 15 yrs in to/van (at least till this spring in 604)

i considered selling house when i started reading this blog, i did not sell, and would have missed almost exactly a mil (tax free) if i had.

keep paid off RE for ever – never sell it.
*********************************************

Never say “never”. In 3-4 years time I’m quite sure how ‘obvious’ current over-valuations are in Van RE (and you’ll be wishing you’d sold at/near the peak.)

BTW, I sold mine last year (not quite at the peak), and I’m now much, much better off for doing so. I won’t be saying my % gains YTD, as I fear I’ll get banned from GF … :-)

TCC