Good luck with that

Janet and Alphonse own a crap semi located thirty minutes  by speeding Uber from the downtown core of the Big Smoke. “Yes,” he says, “it is crap. You can hear the dog next door snoring through the wall.” Purchased for $218,000 six years ago, it went on the market last Monday for an unrealistic, reach-for-the-moon $588,000. There were 104 viewings and 26 offers. It sold on offer night for $712,000.

Stories like this are everywhere. In one day this past weekend two clients dumped two houses, both for over $2.2 million in bidding wars without conditions of any kind, each more than 30% over asking. When the Toronto Real Estate Board stats come out later this week, they’ll be epic. And just in time for the coming Ontario budget in which the government has vowed to take a big whizz on a smouldering market.

What’s changed to ignite this fever in Toronto, Hamilton, Victoria, Niagara, Kelowna, Barrie and (even) Vancouver over the last ninety days?

Nothing. Mortgage rates did not fall. Incomes didn’t advance. Oil did not erupt. And meanwhile we got crazy Trump, ballistic missiles in Korea, terrorist attacks in London and Russia, Brexit part deux and the season finale of The Walking Dead. This is serious.

Of course, what we’re witnessing is one of those times where emotion, speculation, buying panic, greed and hormones move markets off their economic piers. Huge price moves, volatility and risk result. The smartest people around you in such times are always the sellers. Always. Always.

The frenzy is raising eyebrows everywhere. “Fierce Bidding Wars force Toronto Buyers to Skip Home Inspections,” Bloomberg told its global audience on Monday. Of course, doing a home inspection is so 2015. In hot markets any bidder hoping to snag a house would never ask for such a condition. The only exposure most prospective buyers get is at an open house stuffed with dozens of other people, where it’s virtually impossible to find the time or space to comprehend what you’re purchasing. This exposes them to an additional, and major, level of risk. Even bringing your home inspector to an open houses is impossible, since the realtor on duty will kick your asses out. This should tell you all you need to know about the market. Danger.

What to do if you’re reckless enough to be buying now?

Ask the seller if a home inspection report exists, since many smart vendors will have one done prior to listing. Stand there at the open house are read it. All of it. Ask to have a copy emailed to you (although that probably won’t happen). Then grill the agent or the owner about any and all issues raised in the report.

If no document exists, scope out the place as best you can, then query the agent on duty about noticed imperfections or deficiencies. Hold your phone in front of you and push ‘record.’ If you end up buying, and bugs start coming out of the kitchen sink, the basement walls bleed or the garage falls over after the termites finish with it, you may have some legal recourse. It’s against the law for a realtor to lie to you, provide inaccurate information or fail to disclose any material fact that he/she is aware of.

As Bloomberg points out, home inspectors are starving. Business is down by a third in the GTA, and almost half in the sizzling hinterland. It means buyers are offering more money than ever before in history, in a more competitive environment, in a more compressed time, without a scintilla of protection. Often this is based on just 15 or twenty minutes of exposure to a property and its systems. Truly amazing.

Also gone is the once-ubiquitous financing condition. Most buyers are now pre-approved for a certain amount (often bearing no relation to actual income) – which is okay – but the bidding wars change everything. Prices escalate within minutes. There can be an ugly surprise days or weeks later when the ‘winning’ competitor finds out his bank’s appraisal is considerably lower than what he agreed to spend. This is when good people are driven into the arms of bad subprime lenders.

Well, Canadians are not unique in swallowing massive risk during an asset bubble. People stopped doing home inspections in major US cities, too, shortly before the market imploded. The rationale was simple: when properties bloat in value every month, all you need do is borrow some of the gain to fix the problems – adding even more to the real estate’s value. Whazza problem?

We know how that turned out. But, as you know, it’s different here.

Did I ever mention you should sell?

144 comments ↓

#1 AGuyInVancouvwer on 04.03.17 at 6:29 pm

Garth, in a nutshell, what’s the best way to cool it down?

#2 Lisa on 04.03.17 at 6:32 pm

Sigh. I wonder if that will ever happen in my Ottawa neighbourhood. I told my husband to promise me that if it ever does, we will be smart enough to sell….

#3 Vit on 04.03.17 at 6:33 pm

Better topic – How to make your wife to agree to sell home , with more than 1 mil equity in it .

#4 X on 04.03.17 at 6:33 pm

All of the RE industry is blaming supply vs demand….Is supply really that bad, or is it that very few people can either afford to move, or don’t care how much it costs to move up…..I would argue demand has exceeded supply…low rates, house lust, lax lending, less than 10% down, borrow from RRSP etc…..perhaps pulling one, or several of these off the table would not be a career ending move for a politician…..more taxes on selling, foreigners, vacancies, doesn’t seem like the right answer, we already feel nickel and dimed by taxes.

#5 Alice on 04.03.17 at 6:37 pm

Hilarious, turns out the foreign buyer tax probably isn’t what stopped Chinese buyers in Vancouver. Politicians will say anything these days.

https://betterdwelling.com/city/vancouver/vancouvers-foreign-buyer-tax-didnt-stop-real-estate-sales-china-did/

#6 crowdedelevatorfartz on 04.03.17 at 6:37 pm

“It’s against the law for a realtor to lie to you, provide inaccurate information or fail to disclose any material fact that he/she is aware of….”
*********************************************
Pinning a realtor down on anything would be like trying to nail Jello to the wall…

Greaterfools in this Toronto market wont be allowed to ask hard questions……next bid takes it!

#7 Bond Junkie on 04.03.17 at 6:39 pm

Fiiiiiiiiiiirst. Hello from Raleigh.

-Bj

#8 Goldie on 04.03.17 at 6:41 pm

It was St.Petersburg which was bombed today. They don’t know yet if it was related to the religion of peace.

#9 Dave on 04.03.17 at 6:46 pm

This market absolutely crazy! Biggest life purchase decided in 20 minutes. The risk is tremendous and blows my mind.

#10 Paul on 04.03.17 at 6:47 pm

We’re screwed!

#11 Smoking Man on 04.03.17 at 6:49 pm

Love the tee shirt

#12 Love this Blog on 04.03.17 at 6:51 pm

Oh it is going to be a hard painful crash.

#13 Smoking Man on 04.03.17 at 6:59 pm

DELETED

#14 Lulu on 04.03.17 at 7:01 pm

Anyone not selling right now will regret it later all their life, there is no win it all in an investment world, you gain a whole lot for basically nothing put in, just because you are the lucky bunch that own a SFH in a hot hot sizzling market and if you think you gonna hold it off a bit more and not leaving any money on the table, you think you can win ahead of the market, think again, when the tide turn, you are not able to run faster than it, you will got buried and eaten alive and no one will catch the fallen knife. Profit your liftetime windfall and enjoy. You cant win it all!!

#15 Dick C on 04.03.17 at 7:02 pm

I would love to sell my house and travel the world. Problem is, it wouldn’t be much fun with the wife and kids. So I will sit here in my townhouse with the children bouncing off the walls and the bathrooms in need of serious updates after potty training three boys.

Best financial advice I can add to this conversation: Don’t have children. It might or might not be the best life advice, but I’m damn sure it’s good financial planning advice.

#16 Average Joe on 04.03.17 at 7:03 pm

Was at an open house a couple of weekends ago, not that far from the Belfountain General Store actually. Dozens of young families – so obviously from Toronto it wasn’t funny. How do I know? Because the kids were playing in the yard like they’ve never seen grass before. $849k asking for a 30-something 1800 sq ft two storey on a half-acre suburban lot, seriously in need of updating (from the virtual tour – never actually got inside!) and two days later it had sold firm for $1.11M. Add about $200k for updating and wow. Oh yeah, and what’s lurking under the large yard with soggy grass, you ask? The septic system. Any guesses what the lifespan of a septic system is? Yup, about 30 years. Good luck with that!

#17 Pre-retiree on 04.03.17 at 7:04 pm

We sold. Probably left some money on the table but we’re at peace with it. Especially since we rent back our own house at a very competitive price on a long-term basis.
Interestingly, a wiser, older, richer, blunter (is that possible?) version of Garth, that is Stephen Jarislowski said on BNN that the housing market will come down and it will come down with a bang. I, for one, believe him.

#18 John Ayres on 04.03.17 at 7:05 pm

Garth haven’t been here for a while but see little has changed no actually it’s gotten worse. How long is it now that you have been trying to talk some sense into people your either a extreme optimist people will get it or you love the comedy of it all.

#19 Leo Trollstoy on 04.03.17 at 7:09 pm

Toronto haz da BOOOOMING!

#20 RentYVR on 04.03.17 at 7:15 pm

I hear you Garth, but speaking here from YVR I can tell you that the market is still hot, particularly in the high-end condo segment. Was at an open house in Yaletown here on the weekend. Asked the realtor about offers and he said that the listed price (which seemed fair or even a bit high) was already blown through by two potential buyers. Called today and it’s gone. Looks like the market still has legs.

#21 Alice on 04.03.17 at 7:22 pm

@ #6 crowdedelevatorfartz on 04.03.17 at 6:37 pm

If a realtor lies they get what, a 20 day suspension? That’s probably how long it takes to get the next client (at least).

#22 Michael King on 04.03.17 at 7:23 pm

The Canadian RE market is unhinged and today’s blog entry is another indication of this. However, Australia looks to be on another level of madness altogether. Interest-only loans are common. From what I can find, only 2% of Canadian RE loans are in this category (I could be mistaken). Check out this article for more on the fun and games going on Down Under. Garth, your view on this type of loan in Canada would be much appreciated.

http://wolfstreet.com/2017/04/02/house-price-bubble-sydney-melbourne-new-high-politicians-promote-scheme-to-bitter-end/

#23 dr. talc on 04.03.17 at 7:29 pm

What’s changed to ignite this fever in Toronto, Hamilton, Victoria, Niagara, Kelowna, Barrie and (even) Vancouver over the last ninety days?

Nothing.

It’s tax time, causing some, to notice for the first time, retro active changes in PR reporting. If they already sold, too bad.
But if they intended to sell in the hot spring market, the changes may have an impact on their decision if they were counting on that exemption

= less supply
=higher prices

#24 Suzanne on 04.03.17 at 7:33 pm

Agents for buyers are getting around the subject to financing clause by asking for bank appraiser access AFTER the offer has been accepted. This would have been considered a risky move back when I was selling real estate in the ’90’s as the vendor does not have to grant access and the lack of forthrightness would have been considered poor form on the part of the buyer’s agent. Today however, a listing agent who’d deny access may find him out of luck should he need the favour returned one day now that subject-free offers are the norm, unfortunately. Glad I’m retired.

#25 TurnerNation on 04.03.17 at 7:36 pm

A 20-30% in GTA means that sht $1 million semi falls to $750,000. Big deal still way overpriced.
And a falling $CAD only will attract more foreign investors.
It would take a large interest rate hike which helps the home currency too.

Smoking man called rock bottom $ Cad years ago…due to Poloz the export man.

#26 Braaap on 04.03.17 at 7:38 pm

The craziness is creeping North. I live in a town just South of Barrie house next door bought for $325 few years back listed for $499 which I thought was to much and sold for $650 in a bidding war the first day on the market. Starting to see for sale signs popping up everywhere with outrageous asking prices only to see sold for appove asking. Its starting to sink in how crazy this market is getting. Assuming people are cashing in on the GTA and moving North. Time to sell and move back in with the parents.

#27 PeterfromCalgary on 04.03.17 at 7:45 pm

Toronto is so Phoenix 2006.

#28 Smoking Man on 04.03.17 at 7:47 pm

#17 Pre-retiree on 04.03.17 at 7:04 pm
We sold. Probably left some money on the table but we’re at peace with it. Especially since we rent back our own house at a very competitive price on a long-term basis.
Interestingly, a wiser, older, richer, blunter (is that possible?) version of Garth, that is Stephen Jarislowski said on BNN that the housing market will come down and it will come down with a bang. I, for one, believe him.
…..

How, what’s the catylist?

Every open house I went to on the weekend the agents were saying. “Toronto 2 best city in the world. We are 14th on the most expensive city list. Rates will be low forever. Mass migration to Toronto for jobs.”

You left alot on the table and so will I shortly.

It sucks.

#29 Joseph R. on 04.03.17 at 7:49 pm

“Well, Canadians are not unique in swallowing massive risk during an asset bubble. People stopped doing home inspections in major US cities, too, shortly before the market imploded. The rationale was simple: when properties bloat in value every month, all you need do is borrow some of the gain to fix the problems – adding even more to the real estate’s value. ”

It does not look like the behaviour of first-time home buyers, but rather overly confident second or third-time buyers; probably due to the fact they made a lot of money on their first homes and now want to live closer to their workplace.

Home buyers are perceiving real estate as low risk/high reward investments since all popular economic indicators; inflation, unemployment and oil prices are low.

Greenspan coined the term “irrational exuberance” to explain the behaviour of stock investors when they abandoned their natural defences due to low inflation and high stock evaluations which lead to the dot-com stock bubble to the 90’s. Robert Shiller (famous for the CAPE ratio and Case-Shiller Home Price Index ) the same term when talking about the housing bubble of 2004-2008.

Why did it happen in the past 90-days instead of another period? Not sure but it shows you can’t time any market.

#30 Damifino on 04.03.17 at 7:51 pm

…the coming Ontario budget in which the government has vowed to take a big whizz on a smouldering market.
——————————————-

Must see to believe. But hey, this would be fun:

Go to a crowded open house with some bogus ‘device’ dressed up to look important. Maybe use an SPL meter or something like it. Print “Carcino-Tron” on the side in a professional looking way. Then wave it around down by the baseboards, and say “Wow! Over two thousand milli-Strumpels! I’m outta here!!”

One load of BS deserves another.

#31 Smoking Man on 04.03.17 at 7:52 pm

#25 TurnerNation on 04.03.17 at 7:36 pm
A 20-30% in GTA means that sht $1 million semi falls to $750,000. Big deal still way overpriced.
And a falling $CAD only will attract more foreign investors.
It would take a large interest rate hike which helps the home currency too.

Smoking man called rock bottom $ Cad years ago…due to Poloz the export man.
…..

My calls are pretty good. Five years ago when I started bashing teachers people thought i was off my rocker, no one know what a SJW was. I did.

I’ve built a respectable fan base on here because of it. Notice no one chirps my speeling or grammer anymore.

Time for a you tube channel.
Got to get a tan first.

#32 TurnerNation on 04.03.17 at 7:55 pm

Attention Torontonians: dispose of your old, unwanted or broken homes here. Top dollar paid.
Just call 1-800-UPA-UPPA for a fast sale – no questions asked!

#33 truthbetold on 04.03.17 at 8:02 pm

Quick question for anyone with real stats… what is the sales volume like in the GTA over the last 5 yrs or so? Just curious if there is more activity than usual, less or similar in terms of actual dwellings changing hands. Thanks in advance.

#34 Be honest on 04.03.17 at 8:13 pm

Garth, do you believe that it is possible for stocks to be in a bubble, or is this only possible with real estate? Be honest.

Sure. But they aren’t. — Garth

#35 bigtowne on 04.03.17 at 8:15 pm

Housing in Victoria, B.C., has literally ended up in the back seat. Rentals are so scarce now in the Queen City folks are sleeping in their cars and the civic authorities are responding. Signs posting “No Sleeping In Cars” are posted throughout the city. Homeless shelters are not meeting the demand. I guess that makes us world class now.

#36 jay on 04.03.17 at 8:16 pm

Garth,you better keep an eye on who Bandit’s hanging out with. http://www.straight.com/news/889796/vancouver-where-even-dogs-are-overdosing-fentanyl

#37 IM in C on 04.03.17 at 8:17 pm

Here in Calgary we have inventory piling up, but significantly, prices are sticking.
What will happen in Toronto when the boom stops. The same thing that is happening here. There will NOT be a bust. Prices will remain floating like a giant gas bag.

#38 OttawaMike on 04.03.17 at 8:22 pm

#26 Braaap on 04.03.17 at 7:38 pm
The craziness is creeping North. I live in a town just South of Barrie house next door bought for $325 few years back listed for $499 which I thought was to much and sold for $650 in a …
———————————————

I just love all these paranoid postings where people describe their location in nebulous terms within a province.

Don’t worry folks. If you name your town the big bad internet won’t hunt you down, come to your door and kill you. The aliens might but not the people here.

#39 TLG on 04.03.17 at 8:25 pm

The government created and nurtured this bubble and they will not allow it to collapse cuz if it does collapse the entire country will collapse upon itself.

#40 Pepito on 04.03.17 at 8:28 pm

We know how that turned out. But, as you know, it’s different here. – Garth
——————-
Apparently, it is different, at least according to you. You’ve often repeated in this blog that there will be no crash in Canada like in the US. That sure sounds different. Only time will tell if you get that call right.

Correction + melt. Similar result for the over-extended. — Garth

#41 Andrewski on 04.03.17 at 8:30 pm

Insanus: https://www.thestar.com/business/2017/04/03/amid-bidding-wars-toronto-homebuyers-skip-inspections.html

#42 Bobby13 on 04.03.17 at 8:32 pm

The last leg standing at this table is the real estate market and everyone should know it by now. Don’t even think you know what’s going to happen tomorrow or the next day. Only question is when will people lose confidence and refuse to be snookered.? The gdp to stock market is showing a very expensive list of stocks but the way things are going may as well have a monkey try and tell you where to allocate your wealth.

#43 TS on 04.03.17 at 8:32 pm

Lisa

#2 Sigh. I wonder if that will ever happen in my Ottawa neighbourhood. I told my husband to promise me that if it ever does, we will be smart enough to sell….

#1 Why would Ottawa ever go up in value? We all work for the 3 various levels of government so we all know that everybody makes basically between $60,000 (clerk) and $120,000 (director). There’s zero reason to try to impress your fellow neighbours by buying a $1,000,000 townhome.

#2 None of my friends and family want to pay the type of prices it takes to live in Mechansville / Glebe / Hintonburg, Sandy Hill etc. etc. My brother lives at St. Laurent and Montreal for half of what it would cost to live 5 km further downtown. We’re smarter than that in ottawa

#44 Muttley O'Toole on 04.03.17 at 8:32 pm

I suppose the “The Great Southern ” bubble will be Australia’s claim to property madness fame; but what will we call Canada’s property bubble?
“The Great Maple Leaf Meltdown”? “The Great Northern Property White-Out”?
Suggestions awaited.
Also, what I will find interesting is how those buyers that are caught in the middle will react ; i.e. they have paid their deposit and the market crashes before settlement -(and it will crash) – will they wipe off their deposit and flee?

#45 Paul on 04.03.17 at 8:33 pm

Garth’s mantra

https://www.youtube.com/watch?v=QcpfRpnCHn8

#46 prairie person on 04.03.17 at 8:38 pm

Just down the road a large machine has torn apart and pulverized a nice looking older bungalow, loaded it into very large trucks. Now it is digging up the property, getting it ready for a new foundation. A sign said there is a duplex to be built here. It’ll go for megabucks. In spite of what’s her name constantly telling us that house prices are falling in Victoria, they aren’t falling in this neighbourhood. Houses that went on the mkt two years ago and didn’t sell have come back on and they were gone in the blink of an eye.One day I went to a meeting. A For Sale sign had just gone up. Coming back two hours later, there was a sold sign. I wouldn’t mind seling, house is a bit big, but I wouldn’t dare,not unless I already had a house already locked up. There are no (NO) rentals. People already in rentals are being kicked out because the foreign owners want to do major renovations. Those major renovations will, if past experience proves right, be new carpets. Garth is right. This is nuts. Where are all these buyers coming from? And where are they getting the money? In this area it looks like many are renting out rooms.

#47 dakkie on 04.03.17 at 8:39 pm

The Big Short 2: How to bet against the Canadian real estate bubble

http://investmentwatchblog.com/the-big-short-2-how-to-bet-against-the-canadian-real-estate-bubble/

#48 Where to Next? on 04.03.17 at 8:39 pm

Garth,

I own a 1 bedroom + den condo in midtown Toronto. In 3.5 years, its value has increased by 25%. I could sell it for $515K. But where would I go? I own my own business with no rental history. What landlord would take me? I don’t want to live in an older apartment building after renting/owning newer condos over the past decade.

#49 Tony on 04.03.17 at 8:53 pm

Re: #15 Dick C on 04.03.17 at 7:02 pm

You could always sell the townhouse and buy the exact same townhouse for one-fifth the cost in Edmonton, Alberta today. The condo fees may also be one-fifth the cost per month.

#50 Paul on 04.03.17 at 9:03 pm

8 Where to Next? on 04.03.17 at 8:39 pm

Garth,

I own a 1 bedroom + den condo in midtown Toronto. In 3.5 years, its value has increased by 25%. I could sell it for $515K. But where would I go? I own my own business with no rental history. What landlord would take me? I don’t want to live in an older apartment building after renting/owning newer condos over the past decade.
—————————————————————–
Offer first and second month and last three down,

#51 Dawesy on 04.03.17 at 9:20 pm

I’m in Victoria and bought a condo that has easily gone up 40% in 2 years. What I like about it though, is that I earn a yield of over 5% on what my portfolio would be worth if I sold.

My problem is that, there’s really no asset class or RJ ETF portfolio that would generate that sort of income and return for the given risk.

Plus, I think kind of think the Victoria real estate market still has room to grow.

Your condo has made you nothing until you sell. Brag about it then. — Garth

#52 Long-Time Lurker on 04.03.17 at 9:23 pm

Limited Sage,

Check out the charts in the link for #47 dakkie:

#47 dakkie on 04.03.17 at 8:39 pm
The Big Short 2: How to bet against the Canadian real estate bubble

http://investmentwatchblog.com/the-big-short-2-how-to-bet-against-the-canadian-real-estate-bubble/

If you use the U.S. housing market crash as a model for Toronto’s then after the market peak (Toronto, now) it took four years for the U.S. market to hit it’s bottom.

So if you want to buy a property then around 2021 might be when you should be looking. You can save up money until then and then buy at the market bottom.

You could buy a duplex, live in half and rent out the other half; then someone is helping you to pay off your mortgage.

#53 NS Guy on 04.03.17 at 9:27 pm

Yes, yes, Garth, everything you say about overpriced real estate is right.

The real question is – how did we get into this predicament?

1. Poloz refusing to raise interest rates.

2. Justin, the Boy Wonder and his limousine Liberals refusing to take any significant measures to stop offshore money-laundering, which is used to bid up house prices across Canada.

3. A bias of many buyers wanting to live in cities like Toronto, Vancouver, Kelowna. City life is over-rated, small-town life is under-rated.

4. Large numbers of immigrants and refugees moving to Canada and wanting to live in the most expensive cities like Toronto and Vancouver.

#54 conan on 04.03.17 at 9:33 pm

“Stand there at the open house are read it. All of it. Ask to have a copy emailed to you (although that probably won’t happen)”

Or you could take a picture(s) of the document with your phone……..

All 86 pages? — Garth

#55 Smoking Man on 04.03.17 at 9:34 pm

DELETED.

#56 PM on 04.03.17 at 9:38 pm

http://www.movesmartly.com/2017/04/house-prices-up-over-60-in-gtas-hottest-areas.html

#57 Sir James on 04.03.17 at 9:40 pm

Its all about supply and demand, of money. There will always be an unlimited demand for money at 0% (considering inflation is 2%). Its the supply of money thats the problem. $500K lifetime cap on PR Capital gains would fix this quick without raising rates.

#58 conan on 04.03.17 at 9:40 pm

Re: #43 TS on 04.03.17 at 8:32 pm

“My brother lives at St. Laurent and Montreal”,

I live in Ottawa and that is not the greatest hood. Some nice houses, but there is elevated crime levels. The time lines say its going to get worse in that regard. Closing schools etc.

#59 Vancouver Dudes on 04.03.17 at 9:54 pm

DELETED

#60 Leo Trollstoy on 04.03.17 at 9:55 pm

Australia won’t crash. You cry babies need a life. Australia hasn’t seen a recession in almost 3 decades.

https://www.bloomberg.com/news/articles/2017-03-30/as-australia-eyes-victory-on-growth-its-spoils-look-bittersweet

And Ontario is benefiting from Canada’s economic boom

#61 Smoking Man on 04.03.17 at 9:56 pm

I’m not going to go hard on butts and 2T

They are just two stoner buddy’s from collage that worship Zumangas off spring.

Soros is going to kick the bucket soon. His kid won’t carry the touch. He will be hanging out with Ashman in Vegas.

The world will be a better place.

#62 Paddler on 04.03.17 at 9:57 pm

Sold our house in North Vancouver a couple of years ago, and living on Vancouver Island now, observing the Real Estate Market across the water I don’t see much of a correction over there. Sales may be down but prices are not. Most houses still sell over asking in North Van.
Two houses in our new neighbourhood over here sold in less than 2weeks over asking. Where is the big Correction ?? The house we bought over here two years ago was asseset 25% higher over last year’s. Go figure. Still waiting for the big correction the talking heads predict.

#63 northvaneng on 04.03.17 at 10:11 pm

Yvr, north shore, limited rental stock. Purchased in the fall (wife decision), was against, but I love my wife more than my money. Bought Condo w/20% down, major noise issues, so sold last month. Recovered all costs including lost market opportunity because of 10% value increase. Now homeless, thought there was lots to rent, but you go looking and they are ALL garbage under 2500$/month. Unless you are willing to spend two hours in the car commuting or listen to your upstairs landlord all night, buying north shore property is getting really hard to argue against. That said, moving everything into storage (500$month) and renting furnished month-month trying to wait this insanity out…getting harder and harder to do. Property values continue to climb, there is nothing to rent, and no one is leaving. I would be gone but wifey can’t get an equivalent job anywhere else in BC…you tell her to move to whitehorse….fear of buying at the peak versus fear of missing out on buying anything that is livable…rent for 2bdrm condo will be 3000/month by the end of the year…crazy times….good luck everyone that is sitting on the sidelines…this rotten egg is not going to crack for years, so you better have strong willpower.

#64 The Great Gazoo on 04.03.17 at 10:12 pm

“Did I ever mention you should sell?”

Unfortunately can’t, since I sold 4 years ago in Toronto in a great location and renting since then. Reason to sell was for non-financial reasons. Wanted to buy again, looked around for a year, selection not great, even passed up on one excellent home. Decided to rent for a year or two, selection will be better then. Bad Call!

Landlord is a real estate agent who I learned after I moved in has approved plans to build a new home. Tells me he has no plans to build anytime soon – sure what else would you tell a tenant.

Just a matter of time before I am out looking again for another place to rent. Already started looking around so that I am not “forced” into moving on someone else schedule or being rushed to rent a place I do not like. Moving is a pain.

Used to enjoy doing my own home projects, but no more of that. Yeah sure I have some money in a balanced portfolio, but on balance, this sucks!

Listened to a lot of people 4 years ago who I considered smart – housing market is overvalued, but also a lot of smarter people who said, I was crazy not to buy again. Really could not have timed it any worse. Turning out to be a serious error in judgement on my part – right there in life mistakes.

Just love hearing that the Toronto real estate market is up another 25% + last year and my ability to buy again is just that much further out of reach.

Will likely be 5 years or more, before I can get back into the Toronto real estate market. I don’t have FOMO anymore since I have ROMO – reality of having missed out – for the foreseeable future anyway. Nice move.

If I ever get the chance to get back into the Toronto real estate market, I will never exit this asset class ever again!

#65 Sir James on 04.03.17 at 10:20 pm

Someone please correct me if I’m wrong, but it seems we are on the verge of the world’s first global(ist) real estate crash.

#66 conan on 04.03.17 at 10:26 pm

All 86 pages? Garth

Are they that long? There was this place in Belfontaine on Bush street that was that long. Maybe the Taj Mahal.

I can take a picture of a page faster then I can read it. Maybe I am gifted.

#67 Smoking Man on 04.03.17 at 10:35 pm

Should have gone into accounting on nectonite .

I’m stuck with this..

https://youtu.be/BP0IXOr9O8U

#68 Smoking Man on 04.03.17 at 10:36 pm

Should have gone into accounting on nectonite .

I’m stuck with this..

https://youtu.be/BP0IXOr9O8U

#69 Porsche on 04.03.17 at 10:39 pm

This blog is the same as a stock chat board.

You have a stock making new highs and the board is full of basher’s shitting on it trying to knock the price down so they can get in cheaper. lol

#70 Franco on 04.03.17 at 10:47 pm

Yes it is very different here and no end in sight, at least not yet. Anyone that bought a house in dowtown Toronto 10 years ago probably tripled their money or more.

#71 Vancouver getting pounded on 04.03.17 at 10:48 pm

Some of you deluded realtors on here post nothing but fantasy. Sales are way down with prices following. The bubble ia deflating along with your income. LoL. The truth is painfull as tou grind your teeth . :)

#72 ronh on 04.03.17 at 10:52 pm

Need some bed time reading?

https://www.jsmineset.com/2017/04/03/the-next-crisis-is-the-mother-of-all-counter-party-risks-part-1-gijsbert-groenewegen/

#73 bdy sktn on 04.03.17 at 10:57 pm

Don’t miss out.

Victoria park. Comm Dr. 4 new duplex units. Shirt build quality

#74 calgaryPhantom on 04.03.17 at 10:58 pm

Three years of unvesting and have made good return. In the mean time calgary houses have not gone anywhere. Infact slightly lower prices now. Even after 3 years of falling rates.

Looks like a good time to do a rotation. Take some money off the market and buy a house in calgary. Thoughts??

Why? — Garth

#75 bdy sktn on 04.03.17 at 11:00 pm

Shit build quality.

Been for sale a few months.not moving.

In the last week last 2 sold. None left.

#76 Raul on 04.03.17 at 11:04 pm

#3 Vit

Dude, it’s called DIVORCE.

#77 Smoking Man on 04.03.17 at 11:10 pm

DELETED

#78 millmech on 04.03.17 at 11:11 pm

Went to two open houses on the weekend, we were the only people there, talked to both realtors about price and what I thought houses were worth. Both realtors said market only going up in this world class city and brushed off the value I was looking at paying.
Got home after work today to a couple of text messages, first one was a price drop of 12%, second was a price drop of 15%.
Realtors are even wanting me to use their mortgage brokers to get me a better deal, hard to believe in this sellers market.
I am going to wait since I have already saved over six months pay by waiting one day, wonder what will happen if no offers in the coming weeks.

#79 Ponzius Pilatus on 04.03.17 at 11:28 pm

Garth,
The picture of the bimbo student is waay below your intellect.
Better stick with dog pictures.

#80 T-Rev on 04.03.17 at 11:37 pm

Can’t imagine ever buying a house without an inspection…I’ve built homes with my own hands, footing to shingles to trim, and I still put inspection as a condition and hire a pro to come with me before taking off conditions…second set of eyes never hurts, even if you know what you’re looking for. Takes the emotion and the excitement out of it…when you’re pumped about new digs and the juices are flowing, it’s easy to miss that discolored swollen baseboard behind the couch in the basement or the deck stairs hanging on by a couple rusted screws. I stay away from predictions because trying to time any market is folly, but when a sh*#^y townhome 30 minutes from the core triples in 6 years and sells for $700k, it makes me wonder if it’s not all about to roll over…Bought a shack here last fall for not a whole lot more than that, got 2 acres and 2700sq ft with a four-car on city water/sewer 25 minutes from the core or the Uni, and 140 seconds to the nearest Sobey’s liquorstore. North Skatch kayak launch in 15 after that…I’ve lived in Boom-Bust Alberta my entire life…I thought we were the kings of volatility and vertical trends, in RE and everything else, but I’ve never seen anything like what you’re describing in Toronto. It sounds like complete madness.

I don’t get people who think that “the government won’t let houses crash”. We may be in a nanny state under the T2, but we’re not (yet) in a communist state. Interest rates will rise if required to tame inflation…whether it’s by 25 basis points, or by 600. Nobody’s gonna bail your a** out. The US is the richest, most powerful nation on earth and at the time of the GFC had the most liberal President in their history, and nobody got bailed out but the banks…and just because you paid $1M for a dump semi doesn’t make you too big to fail. Rates will normalize. Prepare thyself.

I’ll keep repeating it ad-naseum: Get the hell outta Toronto. Move west. Stop in Calgary, Edmonton, or (dare I say?) Regina. Or any other prairie city for that matter. There’s jobs. Opportunities. Great recreation opportunities. Lower taxes. No PST. Two-story SFHs with those pretty little garages stuck on the front that Gartho loves for under $450,000. Schools. Parks. Rivers. The Rockies. Connor McJesus. Restaurants. Universities. Medical Specialists. Culture. 787 days until the next AB election. And most importantly, freedom. I can’t fathom any other reason that people insist on mortgaging away the best years of their life than people in TO must see the Country as being a dichotomy of TO/YVR vs. the Godless Hinterlands, where if the wolves don’t get you, the loneliness will. Trust me kids, we have wireless coverage and Tinder here too.

And because I can’t leave without my obligatory shot at I’m Not Poloz- you’re comment on yesterday’s post asking if I’d like to censor you- not a chance. I’m opposed to censorship in all forms. Instead, I think out in the open is where your comments belong, where intelligent people can call BS and expose your drivel for what it is: Garbage.

#81 Tony on 04.03.17 at 11:43 pm

Re: #37 IM in C on 04.03.17 at 8:17 pm

Sticking? Sticking after falling 20 to 25 percent on both mls and zolo.ca since November 2014.

#82 What happened? on 04.03.17 at 11:47 pm

Garth,

3 years ago you spoke of a gazillion GTA condos being built, that would over saturate the market and cause housing prices to come down. What happened?

#83 Ronaldo on 04.04.17 at 12:04 am

#44 Where to Next? on 04.03.17 at 8:39 pm

” Garth,

I own a 1 bedroom + den condo in midtown Toronto. In 3.5 years, its value has increased by 25%. I could sell it for $515K. But where would I go? I own my own business with no rental history. What landlord would take me? I don’t want to live in an older apartment building after renting/owning newer condos over the past decade.”
————————————————————-

I feel so sad for you. You poor thing. What an awful state to be in.

#84 you ppl are wack on 04.04.17 at 12:06 am

why do you people even compare investments funds to real estate? that’s like comparing apples to tire pressure monitors.

does your index fund call you and say the rent cheque won’t clear this month because my wife spent all the money so I took away the bank card and then she threw me out. and now I am living at my dads while my wife already has a new boyfriend and i’m a dead beat and will end up owing you for 2 months rent and some unpaid water bills and my little bastard kids will mess up every wall in your brand new house and i’m going to pay you $60 at a time even though I owe you $3400 and hopefully you’ll just get tired of collecting from my degenerate ass.

#85 Fortune500 on 04.04.17 at 12:20 am

Did someone mention SJWs? If you have been following Jordan Peterson and this issue you might enjoy this:

https://www.youtube.com/watch?v=rUdxCj7IKCY

I’m noot doin’ it either …

#86 traderJim on 04.04.17 at 12:53 am

#59 Sir Jimbo

I won’t correct you. All major central banks flooding the world with liquidity and forcing interest rates down. I’ve never seen it done globally before. Will be epically frightening when it pops. But since central bankers not only refuse to acknowledge the bubbles but incredibly insist that deflation is the problem(!!!!) it seems to me that we have another doubling in the size of the bubble before it bursts.
Totally guesstimating of course. But I have been pretty good at that in the past.

#87 ShawnG in TO on 04.04.17 at 1:16 am

found her
https://www.instagram.com/p/BN-KDjeAeNV/

apparently she’s a prominent libertarian Youtube political commentator.
… ok …

#88 Tudval on 04.04.17 at 1:20 am

#51 PM I’ve been bullish on home prices in the GTA for the last 15 years, but I don’t believe those 60% y/y gains.. those stats are garbage, they show avg prices in Toronto 900k and in Richmond Hill 1.3 mil?? But I have said it many many many times that this idiotic jawboning that has become a constant is skewing the market and this is just the fear of intervention.. imagine if they actually go through with some of the crazy proposals I hear… how they could backfire. These people have no expertise in these markets, the psychology, the mechanics etc.. and how could they.. even the real experts don’t know better than the markets themselves.

#89 Freedom First on 04.04.17 at 3:07 am

Great Title today Garth. Much better than me wasting my time trying to argue with some of the insanity being spewed on this Blog.

Financial Principles Rule when practiced over a lifetime. Anything else is just gambling.
……………………………………………………………………………..
Good luck with that-Garth

#90 Jay on 04.04.17 at 4:54 am

I’ve already told my wife that if this sort of bubble ever happens in our area and we can make enough to retire just by selling the house, we’re selling.

She loves our home, but when I put it in the right terms she understood. With our future secured, my job would be a hobby.

#91 Sam the Sham on 04.04.17 at 6:08 am

Well it looks like GTA renters are about to get a serious “hoseing”. It was bound to happen. Rents are doubling for next year is some cases. ($1650 to $3300 in the story) Book you spot a the homeless shelter ahead of time and beat the rush!!

https://www.thestar.com/news/gta/2017/04/03/tenants-at-two-west-end-condos-see-rent-double.html

#92 DoomandGloomer on 04.04.17 at 7:03 am

#81 Jay on 04.04.17 at 4:54 am:

“She loves our home, but when I put it in the right terms she understood.”
——————————————————————–

Women love their homes on an emotional level that men cannot comprehend. It’s hormonal. Irrational. If they could keep the house and dump the man, they would. It’s only pragmatism that makes them keep the man around. Usually, that means they keep the man in order to pay for the thing they really love. Lose the man = lose the house. Men are a necessary evil for the women – a compromise in order to keep everything from falling apart. It’s like, “Yah…I have to have the man around, but at least then I get to keep my real love interest…my HOUSE”.
Houses are to women what mistresses are to men.
Except, houses are cheaper!

#93 Mike in Toronto on 04.04.17 at 7:17 am

#79 Tudval

There’s already been multiple rounds of intervention. Harper put gas on the fire with emergency rates in 2008.

http://www.torontohomes-for-sale.com/account/461083ac0e597a15/pages/2578_13.gif

“Fiscal Conservatives” seem to be about telling people they’re richer than they think. It got the votes while the Millennials were too young to matter.

Not that I think Trudeau has a clue. It’s not an easy thing to stop this mess.

#94 A Reply to #64 ronh on 04.04.17 at 7:20 am

Jim Sinclair lost my attention when he wrote, “We basically need a kind of French Revolution to clean this up!” (Decapitations are not the answer to unfunded pension liabilities.)

Besides, aren’t actuarial assumptions revisited every three to four years?

#95 Herb on 04.04.17 at 7:21 am

#139 yesterday and all concerned,

link to all four published court cases on TFSAs and frequent trading –

https://www.canlii.org/en/#search/text=%22TFSA%22%20and%20%22frequent%20trading%22

http://www.canlii.org really is the first thing you should consult in any legal problem.

#96 IHCTD9 on 04.04.17 at 7:24 am

#81 Jay on 04.04.17 at 4:54 am
I’ve already told my wife that if this sort of bubble ever happens in our area and we can make enough to retire just by selling the house, we’re selling.

She loves our home, but when I put it in the right terms she understood. With our future secured, my job would be a hobby.
__________________________________

Already had this conversation with my wife as well.

Even 1.5+ hrs East of the GTA, the newly rich ex-homeowner Toronto escapees are starting to drive prices up. I know two couples who listed their homes recently just to “fish” for the big dollars.

If my house suddenly commands a massive premium over what its assessment states, I’m selling and moving 1/2 hr north before the City decides to crank taxes like in the mid 2000’s.

Both of us would rather stay where we are, everything is convenient, and everything is paid for, but like Garth says – you’ve got to sell to win.

#97 maxx on 04.04.17 at 8:12 am

In addition to taking a gigantic perma-wiz on this volcanic re market, and whilst they’re standing around, further attention ought to be given to other investment options by tptb for wealth building, such as restoring TFSA limits.
This would stream economy-balancing cash away from overheated markets into other assets. Raising the limit beyond 10K would also be a great move and could trip the switch towards a better economy. It might even change our mind-set from debt acceptance to wealth creation. And restore some optimism about the future. If the young cannot buy decently priced re, at least let them have access to a tool that helps them build wealth faster. And give them hope. They might very well do better than idiots engaging in bidding wars. Putzes.
We desperately need attractive, alternative investment vehicles to re as we we seriously need to get out of debt and become savers again. Not pushed into gambling by a freakishly overheated re market.
Taxes should be levied on those deemed to be trading and/or deriving a living exclusively with their TFSA’s. It is , after all, a tax-free SAVINGS account. As one of our dogs stated in a previous post, it would need to have been named the TFIA. Spirit of the concept, and all of that.

#98 Trumpocalypse2017 on 04.04.17 at 8:13 am

No surprise here.

https://www.nhl.com/news/nhl-will-not-participate-in-2018-winter-olympics/c-288385598

The NHL has good Washington insider connections.

Nobody with half a brain wants to be in South Korea between now and 2019.

Smart move, Gary.

Don’t forget your own shelter needs and extended food supply for what comes next.

#99 IHCTD9 on 04.04.17 at 8:18 am

#47 Dawesy on 04.03.17 at 9:20 pm
I’m in Victoria and bought a condo that has easily gone up 40% in 2 years. What I like about it though, is that I earn a yield of over 5% on what my portfolio would be worth if I sold.

My problem is that, there’s really no asset class or RJ ETF portfolio that would generate that sort of income and return for the given risk.

Plus, I think kind of think the Victoria real estate market still has room to grow.
___________________________________

Lift up your hardwood floor and see if there is any dirt under there.

No?

Then your condo will be worth $0.00 some day.

Stick it out in that condo for 25 years and the losses to taxes, interest, condo fees, insurance, maintenance, and devaluation will destroy any gain that may have ever been realized.

Few residential RE owners/sellers are honest with the actual costs involved with ownership.

#100 IHCTD9 on 04.04.17 at 8:23 am

“Not that I think Trudeau has a clue. It’s not an easy thing to stop this mess”
_____

Especially hard to stop when he ain’t trying to stop jack…

#101 IHCTD9 on 04.04.17 at 8:26 am

#83 DoomandGloomer on 04.04.17 at 7:03 am
_____

Most divorced acquaintances of mine tell me that it’s not hard at all for a women to dump the man and keep the house…

#102 CTO on 04.04.17 at 8:29 am

Garth

One question for you…

Crash,..maybe not. Slow melt more likely?
Maybe you’re right.
It appears we must be near a top. right?

Having said that, can you hazard a guess as to how much real estate would be devalued in 6-8 years.

10% this would mean no lower than last years prices in GTA.
20% this would mean no lower than 2014 prices.
30% this would be no lower than 2012 prices.
60% Anyone who bought between 2005 – 2010 would still churn a profit of sorts. (Many, many houses in the GTA were selling for 200000 – 300000 during those years). Insanely, those houses are now selling for 800-900.
Don’t get me wrong, I think this is as crazy as you do!
What come’s to mind though, is this….
What has to happen to get things back to normal??? Whatever it is. it is going to be catastrophic in nature for sure! It could and likely will shake every foundation in this Counrty.

#103 crowdedelevatorfartz on 04.04.17 at 8:44 am

baby Trudeau survived his first test.
5 Byelections and the voters spoke. Nothing changed. No big upsets. Status quo.
Expect more narcissistic media engagements. The Juno’s were just a taste of the annoyance of the inane”selfie promoting” world we live in. ( although I did enjoy the juxtaposition of baby Trudeau and baby Mulroney in the same show at the same time. Two vapid spawn of political families….a Canadian first?)
What will we call the next generation of Trudeau’s, Mulroneys or, God help us, Trumps?

And then we have a harbinger of the decades to come. Elderly pensioners in Greece peacfully protesting more cuts to their pensions due to the economic meltdown brought upon them by spineless politicians with taxpayer garanteed govt pensions…….
A protest sign spotted at the sit in summed up their mood… “Dont slash pensions, Slash your throats”

#104 jackpot on 04.04.17 at 8:50 am

Sold our crib 8 yrs ago in bloor west, bought in 2005 for 300 k, sold over a mil. Reason for selling: The entire area is sitting on a massive pile of contaminated landfill (common knowledge if you ask around). You can actually smell the garbage in the ground on hot days. Too bad, nice area otherwise. Soil testing should be mandatory.

#105 traderJim on 04.04.17 at 8:54 am

#66 CalgaryP

I understand your contrarian thinking and I like it, but trends last far longer than 3 years, usually.

Commodities were depressed for 20 years before they finally took off.

Maybe once Calgary RE has declined for 10 or 15 years I’d take a look.

Unless you get a big crash, then it’s another story.

#106 IHCTD9 on 04.04.17 at 8:56 am

#34 OttawaMike on 04.03.17 at 8:22 pm

Don’t worry folks. If you name your town the big bad internet won’t hunt you down, come to your door and kill you. The aliens might but not the people here.
______________________

3-4 years ago, I listed my old Jeep on Kijiji for sale. 2 days after I posted my ad, OMVIC left me a voice mail lecturing me about curb-siding. Yes indeed, my telephone number was in the ad.

What is your full name? Full address? How about your telephone number?

Come on Mike, no worries right?

#107 down and out on 04.04.17 at 9:08 am

Where does one go to get training in buying a GTA home .No inspection , no discussion on amenities nearby. I take longer looking at the menu board at Mickie’s than these people bidding on a house , my mind just does not function that fast,driving in the GTA takes up all my CPU capacity and my pulse rate is over a hundred from fear of being slathered.I am sorry i cannot compete in the GTA ant maze of life ,who are these people ,I suspect of all horrors Smokey may be right ,aliens are among us .

#108 Bobby on 04.04.17 at 9:28 am

Only an idiot would buy a house without a home inspection. But more importantly, only an incompetent realtor, would suggest a buyer even do such a thing. Would one buy a used car without taking it for a test drive?
The stupidity in the market is mindnumbing but not surprising given the complete lack of financial literacy among most Canadians. Many believe real estate only goes up but I have seen a number of crashes. What surprises me most is that many will abdicate their most important financial decision to someone who has just finished their online real estate course. More importantly, they may have finished in the bottom half of their class.
When this blows, and it will, I’ll be the first to say that the government had better not bail these clowns out.

#109 off plan dubai on 04.04.17 at 9:44 am

I really appreciate you

#110 cramar on 04.04.17 at 10:21 am

Yesterday we had in fridge repairman—a millennial. He mentioned that he was interested in the house sold recently up the street, but it sold before he could look at it.

When he was leaving, he said it sure is a sellers’ market around here. He put in an offer on a semi in the area at the list of $189k and it was immediately rejected. He said it went for $199K, “TEN THOUSAND OVER ASKING!”

Methinks, it is a good thing you don’t live in the GTA!

#111 Ole Doberman on 04.04.17 at 10:27 am

I’m seeing more rentals piling up in Calgary, and not talking car rentals here – hehe.

As the semester draws to a close this will go manic.

Does anyone know what happens to all these apartments that are sitting empty? I assume first prices will drop, but how much can they drop and still no tenants coming?

Can an entire apartment complex go into receivership?

#112 OMERS on 04.04.17 at 10:38 am

HI, I rock climb for a living and my wife sells umbrella insurance, we are approved for 1.3 million!

#113 TurnerNation on 04.04.17 at 11:25 am

Looking like Dollarama stock will sprint to 115-120 levels here.
It’s our only hope as a country. Dollar store nation.

Tag this #Dollaramarama #InitToWinIt

#114 James Shelly on 04.04.17 at 11:30 am

As a kid who grew up in Celtic Tiger Ireland, let’s just say this…feels familiar. The only question I have is whether there are “caps” on Toronto RE that didn’t exist in Ireland. In Ireland first time buyers, immigrants all fled the country as the market crested, accentuating the crash. Not sure the same will happen in TO, meaning the correction may not be quite so severe?

#115 Smoking Man on 04.04.17 at 11:31 am

What happend to my posts?

Aliens. — Garth

#116 Victor V on 04.04.17 at 11:33 am

Imposing new rent control rules is the “wrong medicine” to cure the growing affordability crisis in hot Ontario housing markets, warns CIBC Capital Markets Deputy Chief Economist Benjamin Tal in a new report.

http://www.bnn.ca/rent-control-is-wrong-medicine-for-toronto-housing-market-crisis-cibc-1.714754

#117 Herb on 04.04.17 at 11:44 am

“No home inspections”, “offers accepted at” etc. are practices imposed by agents who know that this the way to a best, problem-free sale.

It isn’t sellers or buyers who make the market by “suggesting” prices and using such gimmicks. It is brokers and agents maximizing their profits, but if you want to buy you’ll have to dance to their tune.

And just try to point your i-phone at a selling agent and record the conversation!

#118 45north on 04.04.17 at 11:54 am

super clusters: it appears that the government is having some success in Montreal:

The Canadian federal and Quebec provincial governments already support the country’s aerospace industry through various mechanisms, but the Montreal cluster hopes their new innovation strategy will attract the expertise in advanced software and systems design that is needed to be competitive in the future.

http://mcaf.ee/7l0scx

( original url is too long )

it is a very tough fight to stay on top

but the federal Liberals have not been consistent in their support for Canadian aerospace:

The federal Liberals have put the kibosh on Porter Airlines’ expansion plans, dealing a blow to Bombardier Inc., even as Quebec asks Ottawa to throw the struggling company another lifeline.

http://mcaf.ee/y56vrw

#119 Victor V on 04.04.17 at 12:03 pm

Loonie hits three-month low ​after unexpected trade deficit

http://www.bnn.ca/loonie-hits-three-month-low-after-unexpected-trade-deficit-1.714714

The Canadian dollar weakened on Tuesday to a nearly three-week low against its U.S. counterpart, pressured by a loss of risk appetite and domestic data showing an unexpected trade deficit. Following three consecutive months of surpluses, February’s $972 million deficit compared with economists’ expectations for a surplus of $500 million.

Exports tumbled by the most in nearly a year, dampened by a decrease in shipments of aircraft and canola.

#120 Penny Henny on 04.04.17 at 12:09 pm

Of course, doing a home inspection is so 2015. In hot markets any bidder hoping to snag a house would never ask for such a condition.-Garth

Hey Garth I suspect that you are well aware of marketing a Toronto home for bidding wars 101.

A pre inspection is done by the sellers and made available for all to see. This is done so that more bidders will jump in.

#121 Victor V on 04.04.17 at 12:22 pm

Self-professed condo king Brad Lamb says ‘Manhattan-ization’ is coming north of the border

http://business.financialpost.com/news/self-professed-condo-king-brad-lamb-says-manhattan-ization-is-coming-north-of-the-border

#122 IHCTD9 on 04.04.17 at 12:26 pm

Men getting the shaft once again:

http://www.cbc.ca/news/opinion/gender-based-analysis-1.4043312

I suppose under different circumstances I wouldn’t give a rip, but I have unwittingly produced male offspring, and my multi-decade experience with females tells me they have a primordial need for their male partners to work and earn… and the more the better. Unless this is so, true happiness for them is unobtainable.

#123 IHCTD9 on 04.04.17 at 12:27 pm

A pre inspection is done by the sellers and made available for all to see. This is done so that more bidders will jump in.
____

With the inspector being selected by the realtor no doubt…

#124 Penny Henny on 04.04.17 at 12:32 pm

The countdown begins. The Etobicoke bungalow will hit the market April 25th. Last year I would have been happy to accept $850,000. Recent sales in the hood put the value at about $1,150,000 now. $300k in a year. Crazy!

#125 Also in Cowtown on 04.04.17 at 12:36 pm

#110 Victor

Loonie hits three-month low ….. The Canadian dollar weakened on Tuesday to a nearly three-week low….

Weeks, Months … It is the internet so who’s counting?

#126 Iron Mike on 04.04.17 at 12:37 pm

just keep buying houses! ok?!

#127 Penny Henny on 04.04.17 at 12:40 pm

Oh yeah, forgot ot mention.
I purchased the house in 2006 for $388,000

#128 AK on 04.04.17 at 12:41 pm

Manhattan Apartment Prices Tumble In Q1 As Sellers Fret Over Rising Rates

#129 InvestorsFriend on 04.04.17 at 12:56 pm

Latest Mortgage arrears figures are out today

http://www.cba.ca/Assets/CBA/Files/Article%20Category/PDF/stat_mortgage_db050_en.pdf

Six weeks overdue, the latest 90 day mortgage delinquency figures are out… They posted November and December.

Possibly they mean nothing as banks may be effectively hiding delinquencies by offering payment holidays and many other solutions.

Still, the Alberta figures, while still very low, keep creeping up and are now at 0.46% or just 4.6 mortgages per 1000. But that is 4.6 this month and maybe in 3 months those are written off / foreclosed on and it’s a different 4.6 people?

I remain on a self-imposed hiatus until June 1 (saving Garth the trouble of banning me this time). But just wanted to post this data. It’s no-doubt a lagging indicator but still…

#130 PokerCat on 04.04.17 at 1:01 pm

#55 Leo Trollstoy on 04.03.17 at 9:55 pm

“…And Ontario is benefiting from Canada’s economic boom”

You know that type of smoke isn’t legal yet, right?

#131 45north on 04.04.17 at 1:22 pm

Fortune500: If you have been following Jordan Peterson

University of Toronto psychology professor Dr. Jordan Peterson has had a federal research grant application denied for the first time in his long and distinguished academic career.

http://news.nationalpost.com/news/canada/an-opportunity-to-make-their-displeasure-known-government-pulls-funding-of-pronoun-professor

CTO: What has to happen to get things back to normal? Whatever it is. it is going to be catastrophic in nature for sure! It’ll shake the foundation of this country.

it deserves to be shaken

#132 How about utility? on 04.04.17 at 1:29 pm

So I agree with the whole “sell now or regret it later”, I mean I made more than 35% (gross of transaction costs) in the last 2.5 years on my tiny detached in Leslieville after last assessment. But here is the thing…I bought it to be biking distance from work and to have a piece of my own grass in the middle of the busy city, not to make any money on it. I got large chunk of cash vested in it, yes, but I get a lot of that economists call ‘utility’ out of that locked sum. Whatever mortgage I still have is sustainable enough to allow me to feed my TFSA and RRSP and manage balanced(I think) ETF portfolio between the two. I do not plan to be repaying that loan any time soon, unless of course our supreme leader pushes our interest rates past 6%. Whatever I loose in interest on mortgage, I gain in interest gains on my portfolio (and then some). So why would I give up my nice little place which does not really risk loosing me any money (I figure that even if 30% price correction happens I still stand to keep my original cash) and gives me a lot of utility which can not really be quantified with monetary sum? All the arguments for renting are good if you look at the math only, how about the hustle of looking for a decent rental, moving, dependency on a landlord etc.? What is the monetary value on my time wasted on all of that?

#133 jess on 04.04.17 at 2:35 pm

Richmond Fed

Lacker admitted to speaking to an analyst at Medley Global Advisors regarding the September 2012 Fed meeting. Medley publishes analysis for hedge funds and asset managers and is owned by the Financial Times. Lacker said his actions violated Fed communications policies that prohibit “providing any profit-making person or organization with a prestige advantage over its competitors.”

“In 2012, my conduct was inconsistent with those important confidentiality policies,” Lacker said in the statement.

#134 Fed-up on 04.04.17 at 2:41 pm

#123 How about utility? on 04.04.17 at 1:29 pm

Renting has become serious liability in Toronto and Vancouver. Insanely expensive with zero guarantees of stability. Stay where you are if you are happy. No one is forcing you to sell. Recommendations of selling and renting in these 2 cities has proven to be very poor advice in the past 10 years regardless of good intentions of who offer it. This “sound” financial advice based on old data that has yet to show any significance. In fact almost everyone in these 2 markets regrets doing so as they are finding renting or buying completely unaffordable. Oh and “moving elsewhere ” is nowhere near as simple as it sounds. People who live in the real world with careers and families know this.

#135 rainclouds on 04.04.17 at 2:52 pm

#114 “With the inspector being selected by the realtor no doubt…”

No Doubt indeed, dont need a “deal killer” messing with the commission…….

This Independent Inspector explains the pitfalls here in Vandelusional

http://www.houseinspectionsbc.com/article_consumeralert.html

#136 jess on 04.04.17 at 3:07 pm

#122 45north on 04.04.17 at 1:22 pm

Are universities knowledge creators or metric maximisers?
….” H-scores are open to manipulation through practices like self-citation and what one of my old colleagues liked to call “citation soviets” (small circles of people who routinely cite each other’s work)…”
H-index also strips out any information about author order. The result is that there is little information about whether you published an article in a top journal on your own or whether you were one member of a huge team.

http://theconversation.com/explainer-what-is-an-h-index-and-how-is-it-calculated-41162

https://journalism.nyu.edu/about-us/event/2017-spring/bad-science-good-telling-difference/
http://journals.plos.org/plosmedicine/article?id=10.1371/journal.pmed.0020124
Rigor Mortis
http://retractionwatch.com/2017/04/04/failure-essential-part-science-qa-author-new-book-reproducibility/#more-49162

===========
Hira’s book “outsourced america”

H-1B program

A year ago, the wholesale firing of IT teams at Disney, Southern California Edison, and other tech-dependent companies and their replacement by offshore workers with so-called H-1B visas caused a national scandal. We exposed this loophole at the time, and followed up by showing how Congress connived in the visa subterfuge.

Yet, as was documented in testimony by immigration experts Ron Hira of Howard University and Hal Salzman of Rutgers, most of the H-1B visas aren’t being used to hire people with specialized skills. “The vast majority of H-1Bs who are coming in have no more than ordinary IT skills,” Hira testified.

In fiscal 2015, Hira testified, 41% of the jobs approved by the government for H-1B visas were at the lowest skill levels for the jobs, which applies to “beginning level employees who have only a basic understanding of the occupation [and] perform routine tasks,” such as those done under “internships.” Those workers typically are paid 40% below the average wage. Even better, from the employer’s standpoint, is that the workers know that their visas are tied to their employment, which makes them especially submissive employees.

How does that conform to the claim that H-1Bs are all about hiring the best and the brightest employees available globally?

..”the very claim of a STEM shortage in the U.S. is phony. Salzman noted that “overall, our colleges and universities graduate twice the number of STEM graduates as find a job each year.”
Tech industry’s persistent claim of worker shortage may be phony”

http://www.latimes.com/business/hiltzik/la-fi-mh-the-scandal-of-engineering-visas-20160226-column.html

#137 Tudval on 04.04.17 at 3:31 pm

#125 Fed-up What are you saying, you mean moving from your cozy central Toronto neighborhood to the hot up-and-coming market of.. (wait for it)… Uxbridge or Milton is not all that it’s cracked up to be? No way back, ever? How about after the ‘smart’ move you start petitioning the government to tax and burn those awful flippers, foreign buyers, second homes and everything that moves (even mobile homes perhaps) – hopefully that will crash the market so that you can move back and maybe pocket a few bucks in the process? Seems like real estate blogs are littered with such folks, may end up working.

#138 Ole Doberman on 04.04.17 at 3:45 pm

#125 Fed-up on 04.04.17 at 2:41 pm

#123 How about utility? on 04.04.17 at 1:29 pm

Renting has become serious liability in Toronto and Vancouver. Insanely expensive with zero guarantees of stability. Stay where you are if you are happy. No one is forcing you to sell. Recommendations of selling and renting in these 2 cities has proven to be very poor advice in the past 10 years regardless of good intentions of who offer it. This “sound” financial advice based on old data that has yet to show any significance. In fact almost everyone in these 2 markets regrets doing so as they are finding renting or buying completely unaffordable. Oh and “moving elsewhere ” is nowhere near as simple as it sounds. People who live in the real world with careers and families know this.
——————————————————-
Well said – especially that last part about “moving elsewhere”

#139 Karl hungus on 04.04.17 at 3:52 pm

Hey Garth, it still counts as an rrsp contribution if the money is just sitting in the cash portion of the rrsp, right ?

#140 Kris on 04.04.17 at 6:04 pm

#125 Fed-Up
#129 Ole Doberman

Totally agree. “Sell and rent” (the mantra of this blog) has proven to be catastrophic advice in the last 10 years.. at least in the GTA & Vancouver.

Analyzing personal finances (how much income you need to sustain that mortgage) is one thing, but spotting macro-economic trends in demographics, law, society.. that’s another story. When an economist says “the housing market will fall” for 8-10 years while it keeps rising and rising and rising.. Obviously such analysts got blindsided by some factor(s) they didn’t even consider.

#141 Pete from St. cesaire on 04.04.17 at 6:18 pm

Garth, do you believe that it is possible for stocks to be in a bubble, or is this only possible with real estate? Be honest.
Sure. But they aren’t. — Garth
————————————————
Yeah, it’s not considered to be a ‘bubble’ when the forces pushing the asset class up aren’t the average joe but rather an inside operation of artificially inflating prices by hiding QE money there. A ‘bubble’ is the result of a certain illogical mindset, what we’re talking here is a deliberate inflation of the market for the sake of inflating the market.

#142 Jay on 04.04.17 at 6:21 pm

Holding your house loses you money every year.

First, look at the 5-figure interest on a near 7 figure mortgage.

Next, look at land taxes. Insurance. Heating. Maintenance. Inflation.

Then look at closing costs — first buying, then selling. And land transfer tax.

If you buy, wait 10 years and sell for even a modest gain, you’re behind. The carrying costs of that investment add up quick, and I’m assuming above that interest rates stay low. If they jump to even 5%, that makes even a pretty good increase eaten up. The fact that prices will collapse at that interest rate is immaterial.

If you think things that go up cannot go down, I’ve got some pets.com stock to sell you.

#143 Tudval on 04.04.17 at 6:24 pm

#127 jess I could have told you such stories 15 years ago.. from the US and Canada. These were practices sanctioned from the top, companies who were even getting government subsidies to ‘create jobs’… There’s a name for this and it rhymes with reason.

#144 Armando on 04.04.17 at 11:29 pm

Canadians are going to get their economic arses kicked from here to kingdom come before this is over. Not pretty.