You’re kidding…

Well, that didn’t take long…
Last week BC was taken over by a lefty coalition NDP-Green government, promising social justice, environmental stewardship, a better economy, affordable housing and free ponies. This week the energy giant Petronas announced it ‘s throwing in the towel on a $36 billion LNG (liquefied natural gas) facility on the west coast.

Of course it’s not all because socialists and anti-energy zealots are now in charge. The Trudeau government approved the plan, but with 190 conditions and a first-ever cap on emissions. In fact, there are gobs of blame to go around. The greenies protested. First Nations were in a funk. Economic nationalists moaned (Petronas is Malaysian-owned). But the message to the investors was clear, delivered by BC Green leader Andrew Weaver, who said the LNG industry is “nonsense… a colossal failure.”

Well done, Canada. Now all those construction guys, pipefitters, engineers and armies of contractors can enjoy a low carbon footprint serving lattes on Robson Street. One more little nail in BC’s real estate coffin.

Stress? You have no idea…
Not content to geld people who run small businesses or wage war on higher income-earners in general, the T2 gang is gearing up to finish off the speculative real estate frenzy this autumn with the mother of all stress tests. The federal bank cop – OSFI – has proposed that everyone applying for a mortgage qualify for the loan at a rate which is 2% higher than the prevailing one.

So, if you can carry $650,000 at 3%, for example, you must show you could also afford the payments at 5%. This test will apply to all – no matter how large the down payment or if you’re applying for CHMC insurance coverage. Veteran mortgage broker and RateSpy owner Rob McLister likens this to the Kim Jun Un intercontinental ballistic, nuclear-tipped WMD when it comes to market impact. Think of the GTA a smoky hole.

Why would Ottawa actively plan such a thing? (The pre-action ‘consultative’ period is now in progress.) Because interest rates are going up. Way up. The Canada five-year bond that was 0.5% a year ago is now at 1.65% and on its way to 2%. That’s a 400% increase in debt yield, and it will translate into, yes, 5% mortgages down the road.

Anyone born after 1960 has no idea what this might mean.

The voice of experience…
“Back in the 70’s and 80’s I worked for Canada trust and Guaranty trust in their mortgage departments,” says blog dog Vic. “Many of the most senior people had been trained by people who were still influenced by the concepts evolved from depression times. They had some funny ideas and expressions A ‘prudent’ mortgage loan considered the value in the property, the borrower’s ability to pay, if he likely to pay and if the down payment came from his own resources. Our basic responsibility was to appraise and underwrite every mortgage on that basis. The thought that the Lenders mortgage departments would come to be staffed by ‘Mortgage specialists’ who were little more than in-house brokers would have left them aghast.”

Now that banks have CMHC wiping away their risk, says Vic, everything has changed. Not for the better. “Compare when the bank assumes the risk with an uninsured conventional loan and  a high ratio loan when CMHC insures the risk.

“Take two purchasers with $65,000 down.

“Uninsured that’s a sale of $325,000 and a mortgage of $260,000.

“Insured it’s a sale of $900,000, a mortgage of $835,000 plus an insurance premium of $33,400 for a total of $868,000.

“We’ve lost any sense of perspective. If you think that it’s an insurance policy and that somewhere there’s a big pot of money to pay any claims, that various governments haven’t already borrowed to pay for their favourite vote buying programs, you have more confidence than I. If you find this to be just a curmudgeonly rant, I hope that you’re right, otherwise we are so screwed.”

Meanwhile, in Albertastan…
The socialist government in Canada’s most capitalist province keeps telling people the worst of the recession is over. But it’s not. At least when you use commercial or residential real estate as a yardstick of economic health.

Commercial vacancy rates are the highest in Canada in Calgary and Edmonton. The half-empty flagship Bow thingy sticking up in the Cowtown skyline is a memorial to delusional planning. And last week there was a stunning snapshot of how much people don’t want to live in Calgary, or can’t find work there.

At present (says the city) there are 23,600 vacant housing units, which is 2,700 more than last year and the highest in 30 years, if not forever (records only go back to 1989). In the last two years net migration to the city has been negative 5,500, and almost 11,000 empty apartments are the legacy of rising unemployment.

You have to love how the Calgary Herald reported this: “The bottom in the recession is behind us,” economist Trevor Tombe said.” Seriously.

Sure, but it can’t happen here. Can it?
This is the tenth anniversary of the summer of ’07 in Orlando, Florida. It was that year the big housing crash really started to take shape and like in southern Ontario or the Lower Mainland, Orlando had seen a massive appreciation in values, excessive speculation and a surge in mortgage debt.

So where are things now? Any insights to be gained as Toronto and Vancouver start to wobble?

Well, median prices this summer are still 12% below where they were ten years ago, according to the local real estate board. Worse, one in ten local homeowners remains underwater, paying mortgages that are larger than the actual value of their homes. That means for a decade many of these folks have been unable to sell, since they’d have to come up with a serious amount of money just to hand the keys over.

No, Toronto is not Orlando. Feel free to ignore this. You’re special.

221 comments ↓

#1 TM on 07.25.17 at 6:41 pm

First

#2 Aaron on 07.25.17 at 6:43 pm

Tough news for the guys who were hoping to work on the Petronas LNG plant. On the other hand, it seems like it’s great news for North American LNG consumers. Australia has built several LNG plants to serve the markets in Asia and it is resulting in skyrocketing gas prices for Australian consumers (http://www.abc.net.au/news/2017-03-09/gas-prices-will-rise-and-there-is-not-much-we-can-do-to-stop-it/8340536). With the cold Canadian winters and heavy use of gas heating, I’d think that the resulting price increases could be devastating for Canadian consumers.

#3 I thinks I know something on 07.25.17 at 6:43 pm

I do wish that I knew what the Elites have in store for us.

#4 Debtslavecreator on 07.25.17 at 6:46 pm

The stress test should have been implemented 6-7 years go not now. Typical stupid government always acting after the horses have left the barn
I hope they pass this stress test but I have my doubts – they should wait until the market has stabilized
The left wing brain disease taking over our nation is simply progressing the way it always does with the corrupt state and its sponsored cartels looting everything
They will not stop until all of it is sent there way and people in Canadstan march to Parliament in protest
This is what we get from years of corruption between governments, and political and financial and other elites
Good luck to all
Bye bye large mortgage holders

#5 keith on 07.25.17 at 6:55 pm

Andrew Weaver, a skilled mathematician to say the least has calculated that the price of LNG needs to be ten to twelve dollars per gigajoule for the B.C. industry to be viable. It’s current price is under three. He did not bother to argue environmental or first Nations issues, he simply pointed out the economics wouldn’t work at current prices and was consistent on that message for years.

So Petronas throws in the towel, and specifically points out that it is based on the economics of today’s prices and not on the change of government. Commentators had a choice to take the high road, or go down the tired “socialists are anti business.” Garth, since you are an ex politician turned financial commenter, I hoped for better than this predictable cheap shot at a brand new government. Newsflash – the NDP doesn’t determine commodity prices, and the economics trumped all other issues in this case.

#6 Michael King on 07.25.17 at 6:56 pm

Daily reader and big fan of this blog. I was very happy that Petronas cancelled the LNG project. I have two questions for you (Garth). 1) Do you believe that Anthropogenic Climate Change is real and that it is a serious issue? 2) If you do agree that it is real and a serious issue, what do you think should be done about it?

#7 Keep Calm and mow the lawn on 07.25.17 at 6:57 pm

Office of the Superintendent of Financial Institutions (OSFI)

=hoax maintenance. You all know what the hoax is, if you don’t, you’ve been brainwashed.
OSFI should make like a proper superintendent and mop the floors of their own bullshit.

#8 Ketch on 07.25.17 at 6:57 pm

When are First Nations not in a funk?

#9 Mark on 07.25.17 at 6:57 pm

Its rather sad that Canada’s “media” has become beholden to the RE industry in a way that’s completely unprecedented. Willing to print Realtor presses verbatim. Willing to report on the RE marketplace without seeking any dissenting views on price movements. The words “sales mix” are practically unknown to Canadians who, for the most part, are still valuing their houses by multiplying the Realtors’ alleged ‘average’ increases by a previous assessment of their own.

Its all fun and games though until people get hurt. The plateauing of prices in 2013 allowed not many people to be substantially hurt, until recently, by the RE-industry bought and paid for media. But now, with price drops pretty much undeniable in the biggest Canadian cities, there’s a lot of fear in the air. This is probably why the Canadian dollar has done so well lately.

#10 paracho on 07.25.17 at 6:58 pm

I visit Orlando and Florida often . The prices have marginally and slowly increased since 2007… but they are mostly still underwater. Friends of mine, close to retirement went in for great properties fairly priced in 2008 and 2009 as winter residences . They love it !
Most do not consider how many are paying a mortgage on value that just is not there ( it is even worse for Las Vegas and parts of Arizona and other parts of depressed USA post 2007 . The 12% average is just a mean of all properties . Half of thee properties are valued in at amounts even less than minus 12% !
It could happen here and I fear there is a probability it just might . I lived through 1991 and my own dad was stuck with a property inBrampton which he still owns . It was meant as a flip . He did well on 3 flips but got stuck on this property . He stubbornly held on and paid as much as he could to reduce interest costs . He was paying interest onvalue that was not there . Luckily it was always rented out and the same tenants have been there since 2001. It took 13 years for the value to come back to its purchase value without factoring in inflation . It would be profitable to sell now, but my dad is in his 80s and the tenants give him a nice rental income on top of his pensions .

#11 GTA Refugee on 07.25.17 at 6:58 pm

They all laughed at me and told me I was crazy for selling! it was summer 2016 and I just sold my 3 year new deatched house in Durham. It went up in value 240k.

Thank you Garth, I didn’t want to become the greater fool

#12 I Hate Milton on 07.25.17 at 7:02 pm

Period.

#13 Canada Real Estate Update on 07.25.17 at 7:02 pm

Here is another massive effort by Liberals:

http://business.financialpost.com/personal-finance/mortgages-real-estate/massive-effort-underway-to-create-database-that-will-shed-light-on-canadas-housing-market/wcm/7b6aff4d-0bff-4223-a2cc-bc0207ff9e89

#14 Frank on 07.25.17 at 7:03 pm

Not content to geld people who run small businesses or wage war on higher income-earners in general, the T2 gang is gearing up to finish off the speculative real estate frenzy this autumn with the mother of all stress tests. The federal bank cop – OSFI – has proposed that everyone applying for a mortgage qualify for the loan at a rate which is 2% higher than the prevailing one.

You sound like you think this is a bad thing. Considering tax payers (via the CMHC) hold the bag on mortgages I think it’s a good thing for the government to ensure we’re not liable for people who can’t take less than 2 rate hikes a year over a 5 year period.

Want to privatize the CMHC? Sure, I’m down with loosening regulations but as long as I’m backing people’s homes, they owe me the decency of buying something they can afford.

These are uninsured borrowers. — Garth

#15 Chaddywack on 07.25.17 at 7:04 pm

All this socialism these days makes me yearn for a Canadian version of Reagan to come along.

He also came with 21% interest rates :)

Burn baby burn!

#16 Smartalox on 07.25.17 at 7:07 pm

Someone posted this yesterday:

https://www.biv.com/article/2017/7/feds-take-developers-court-over-presale-flippers/

When I read the article, the interview with the president of the development company (PCI) caught my attention:

In a phone interview with BIV, PCI Developments Corp. president Andrew Grant said he didn’t know why the government was targeting the Marine Gateway.

“It is a high-profile project,” Grant said. “If they were trying to get some data or track some assignments of contracts between our purchasers and subsequent people that closed on the units, then maybe they feel that because it’s high profile and it’s large, that it would be more efficient to look at a project like that.”

Not only is it a large project, but probably a lot of people who were flipping properties there, speculated on other properties in other projects, too.

Grant said presales at Marine Gateway began in March 2012 and closed about four years later. He said the company took steps to verify buyers’ information and restricted purchases to one unit per buyer, eschewing bulk sales and sales to corporate entities.

In other words, detailed lists were compiled of individual purchasers (i.e.: small-time investors) – the kind that are more likely to crack under the pressure of an audit, compared to well-funded corporations that might tie audits and subsequent proceedings up in the courts for a few years.

“We had criteria in 2012, which was probably several years before some of this controversy and profile around foreign buyers came about, but we had a process,” he said.

I think the subtext here is: “Back then, we thought that record-keeping really mattered, and that enforcement could occur at any time. It wasn’t until much later that things were so busy that the paperwork got ahead of us, or that the rules got so bent, they didn’t seem to matter any more.”

“Our bank and our lenders, at that time [in] 2012, were concerned about knowing the origins of where people were coming from and the funds being used to buy, so it was relevant to us and we did a good, thorough job.”

But not any more?

This is the unravelling of the web. Those who bought units, but file taxes from different addresses? Best be claiming rental income, or come up with a good story. Or maybe they bought a pre-sale unit, and flipped the contract? Did they claim that income?

What about the buyer? Are they living there now? Did they flip and pay tax on the profit?

Are you interested in cutting a deal? Great; what can you tell me about the agents who brokered those deals?

It’s going to be like shooting fish in a barrel.

#17 Ace Goodheart on 07.25.17 at 7:08 pm

RE: “Anyone born before 1960 has no idea what this might mean.”

Is this a typo? Mortgage rates in the 1980s were almost 20%. Anyone born before 1960 would remember that.

After then 1990’s crash rates were above 9%.

5% is nothing. 5% is cheap. I remember when a car loan was over 20% with good credit.

On another note what is it with everyone backing out of their real estate purchase deals? It’s getting ridiculous. I have heard from so many people just this week (we are at Tuesday) that the buyers have just “disappeared”. Left their deposits, stopped answering calls, number is disconnected, their Agent can’t find them. What in the world is going on? I hear a lot about this as I work in an area where houses are constantly being sold (divorces). All of a sudden we are stuck on a whole bunch of settlements, because the buyers just disappeared on us.

Yup. Typo. Anyone born after 1960… — Garth

#18 Victoria UP 40% on 07.25.17 at 7:10 pm

Since we are all using ZOLO to assess the market, I guess we should not show the ZOLO stats for Victoria to VREU.

The queen of ‘sales are collapsing for two years with price declines around the corner’ would be floored with what zolo has to say about Victoria:

The asking price of homes for sale in Victoria has increased 40.00 % since July last year, while the number of homes for sale has increased 11.88%.

https://www.zolo.ca/victoria-real-estate

Yes, that is 40% in less than a year….again 40% in less than a year.

Ouch – 40% up in one year far outstrips the price gains of TO. But alas, Victoria is in BC, and it eludes the attention of the federal government.

Are you now glad you sat on the sidelines renters? LOL.

You will be waiting half a decade for that 40% to disappear IF a correction ever gets started in the land of soggy brains…

#19 Mark on 07.25.17 at 7:10 pm

“With the cold Canadian winters and heavy use of gas heating, I’d think that the resulting price increases could be devastating for Canadian consumers.”

That was my view. Also, the gas will eventually be needed for domestic purposes, and for North American industrial revitalization and competitiveness. If it stays in the ground for another 10-20 years versus the case of building a LNG plant, it won’t exactly lose its value.

Also, the huge elephant in the room with LNG is that 20-30% of the gas is *lost* in the process of converting it to LNG and shipping it to a customer. So much for environmental friendliness if you’re losing 20-30% before the gas is actually delivered to its end user. If we are sitting on so much cheap gas, much better to build a Canadian petrochemicals industry to utilize some of that gas. The dum-dums, for instance, tore up a significant chunk of Edmonton’s petrochemical industry when they shut down the Celanese production, relocating it to Singapore ~20 years ago. Now natural gas is expensive in Singapore, but cheap in Edmonton. A completely short-sighted decision.

#20 paracho on 07.25.17 at 7:12 pm

@ #4 debtsalvecreator…i could not agree with you more.This stress test and other policies should have been implemented 7 plus years ago . Plus other policies..but the governments , both federal and provincial just let things slid .
These policies have come at the beginning of a correction and will just help the correction intensify along with interest rate increases( the government and Poloz can say what they like…but historically we follow the US interest rate policies and the bond market).

#21 Mark on 07.25.17 at 7:12 pm

“Here is another massive effort by Liberals:”

Good lord, remember the last time the Liberals tried to create a ‘database’? The gun registry was billions over budget and never did work properly.

If the Liberals want reliable RE market information, all they need to do is pick up the phone and talk to people like Ross Kay or myself. Or any statistician or economist worth his salt who isn’t hopelessly beholden to the financial sector. Its not hard to assemble all the required data on the Canadian RE market from available sources. No boondoggle of a ‘database’ required.

#22 Frank on 07.25.17 at 7:12 pm

The socialist government in Canada’s most capitalist province keeps telling people the worst of the recession is over. But it’s not. At least when you use commercial or residential real estate as a yardstick of economic health.

Who does that?

I’d use the price of their economies primary resource. It fell by over 50% but has stabilized as has the job loss. Barring a collapse in the Middle East affecting world oil supply it looks like this might be a new normal for oil values. This has happened many times in history and our nation is littered with ghost towns surrounding mines of a resource that plummeted in value once supply went up. Check out Barkerville, it’s a well-preserved example but there are tonnes of nickel mining towns etc too. This is why an economy should be diversified.

Oil isn’t going away, Alberta will survive it just may be awhile, if ever, that the glory days of “two feet and a heartbeat gets you $45/hour driving a truck” return. Is the worst behind them? Yes. Are there still signs of the excess? Yes.

#23 Frank on 07.25.17 at 7:16 pm

No, Toronto is not Orlando. Feel free to ignore this. You’re special.

No it’s not. Toronto has a diverse economy including finance, tech and media. Florida is tourism, retirement and fruit production.

That said it doesn’t have to get as bad as Orlando for a lot of big smoke people to be in a lot of pain. When your $1M Toronto house drops 25% and you need a quarter million just to walk away then it’s not a lot of consolation to say “oh well, Florida had it worse a decade ago”.

#24 Trojan House on 07.25.17 at 7:17 pm

#6 Michael King on 07.25.17 at 6:56 pm

1) No
2) Obviously nothing

#25 crowdedelevatorfartz on 07.25.17 at 7:17 pm

@#5 keith

Total agreement.
Political wags of all stripes would roll their eyes everytime Christy Clark would prattle on ad nauseum about the “thousands of jobs” LNG would bring…..all while the Australians were ramping up their govt subsidized LNG plants.
Not to mention the US fracking creating…..A world wide glut of LNG…..hence the spiralling prices.

Todays announcement 1 week after the NDP took power?

Pure partisan theatrics.

One wonders what monumental lie Christy Clark would have spewed forth if she was still premier today.

Once again proving it doesnt matter what party is in power. Big business will do what ever it wants on the road to profitville.

#26 crowdedelevatorfartz on 07.25.17 at 7:19 pm

@#8 Ketch
“When are First Nations not in a funk?”
+++++++++

When Black Lives Matter upstages everyone for most media coverage ?

#27 OSFI Changes on 07.25.17 at 7:21 pm

Not content to geld people who run small businesses or wage war on higher income-earners in general, the T2 gang is gearing up to finish off the speculative real estate frenzy this autumn with the mother of all stress tests. The federal bank cop – OSFI – has proposed that everyone applying for a mortgage qualify for the loan at a rate which is 2% higher than the prevailing one.
——

What is the big deal?

The majority of new buyers do not have 20% down, so they fall under the current stress test of mortgages 2% higher than prevailing ones. And we have seen how effective that stress test was right? Right, prices went way up after being implemented…

Very few new buyers are uninsured. And for those renewing their mortgages under the potential new OSFI rules, the vast majority – because most take 5 year fixed mortgages – will be fine because they will have paid off a significant amount of their mortgage over five years so the 2% increase on a new, lower mortgage, will be inconsequential.

A lot of fear over this proposed change despite the fact that it will hardly dent the market.

#28 Willy H on 07.25.17 at 7:21 pm

“Well done, Canada. Now all those construction guys, pipefitters, engineers and armies of contractors can enjoy a low carbon footprint serving lattes on Robson Street. One more little nail in BC’s real estate coffin.”
__ __ __ __ __ __

Indeed, well done Canada. The environment (fragile ecosystems) around Prince Edward, Vancouver Island and the North Pacific in general have been granted a stay of execution by the Petronas decision. High paying short-term construction jobs may make Bay Street horny but it’s just a blip versus thousands of years of fresh rivers, pristine creeks, fresh fish, and forests. It’s the planet’s balance sheet that won today.

Northern Alberta is facing an environmental holocaust of sorts if you listen to a former Alberta minister:

… The royalty rate collected on oil sands projects before “payout” is currently one per cent, which according to Warrack is so low it is “like a rounding error from zero.”

He feels the lack of government oversight and fair royalty collection for the oil sands is creating a massive restoration liability. “There is going to be a thousand years of carnage left up there and we are not even getting fair money for it… I mean this is crazy, just crazy.”

As far as pledges to restore the area around Fort McMurray, Warrack is not optimistic. “Anybody who thinks the environment [at oil sands operations] is going to get fixed is smoking something. I mean they will just declare bankruptcy and they are out of Dodge. Is there any doubt?” …

https://thetyee.ca/Opinion/2011/04/13/HarpersBigQuestion/

Bay Street wins but the planet takes a massive hit!

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

“Back in the 70’s and 80’s I worked for Canada Trust and Guaranty trust in their mortgage departments,” says blog dog Vic. “Many of the most senior people had been trained by people who were still influenced by the concepts evolved from depression times. They had some funny ideas and expressions A ‘prudent’ mortgage loan considered the value in the property, the borrower’s ability to pay, if he likely to pay and if the down payment came from his own resources. Our basic responsibility was to appraise and underwrite every mortgage on that basis. The thought that the Lenders mortgage departments would come to be staffed by ‘Mortgage specialists’ who were little more than in-house brokers would have left them aghast.”
__ __ __ __ __ __ __

Yes, my grandfather was one of these folks that worked for Canada Trust Real Estate at that time. He managed to pass his real estate exam in this early sixties. He was a child of the depression and remembered watching his mother die of TB , they dirt poor and could not afford the $1.50 for a doctor to visit the house in the late 30’s. He sold war time homes in the Danforth-Pape area, a few commercial buildings and on rare occasions small apartment complex’s. His top concern was the buyer’s ability to carry the mortgage. He recommended 35% down for all prospective home buyers. My grandfather did not die a rich man, but he died a good man who made an honest living.

#29 Smartalox on 07.25.17 at 7:21 pm

This:

Now that banks have CMHC wiping away their risk, says Vic, everything has changed. Not for the better. “Compare when the bank assumes the risk with an uninsured conventional loan and a high ratio loan when CMHC insures the risk.

“Take two purchasers with $65,000 down.

“Uninsured that’s a sale of $325,000 and a mortgage of $260,000.

“Insured it’s a sale of $900,000, a mortgage of $835,000 plus an insurance premium of $33,400 for a total of $868,000.

If your $65k down payment is 20% of your purchase price, your purchasing power is limited to $325k.

If your $65k down payment is 5% of your purchase price, the price that you can ‘afford’ to pay is much MUCH higher.

This is the root cause of the real estate bubble, right here.

#30 Stone on 07.25.17 at 7:23 pm

I’m one of those old style bankers who actually followed those rules on how to approve someone for any kind of loan including mortgages. It was common sense thinking. I kept telling the clients “you don’t want to only afford catfood, if that” or “sir, you can’t even afford the rope to hang yourself with”. Do you think any of thse fools ever listened? Nope. They instead were greedy and hoovered all the debt they could get. 2% stress test. Still too weak. It should be even harder to qualify since no one seems to be able to think beyond their next meal. Rates will probably go much higher than that. And with wages stagnant as they are, god help those morons maxing themselves out. So happy not to have any debt and a portfolio paying out a steady flow of income.

#31 I'm stupid on 07.25.17 at 7:23 pm

When Garth gets blamed for causing the housing bust I’ll know we hit bottom. Right now the dip in prices are being blamed on everything from new regulations to buyers taking a break. Eventually the conversation will shift to Trump and Nafta, then to Trudeau. When the blame turns to Garth we’ll know the bottom is in.

#32 Calgary Rip Off on 07.25.17 at 7:25 pm

You have to love how the Calgary Herald reported this: “The bottom in the recession is behind us,” economist Trevor Tombe said.” Seriously.”

Calgary Herald is fake news. At the same time, commuting to work this morning is still annoyingly wall to wall. Mass exodus? Go for it, less people on the road.

Housing costs are still too high, rentals and mortgages. All of it is a claustrophobic rip off.

You need at least $100K+ to afford to live in Calgary. If that is really lousy, marry an American, USA is cheaper, and in many cases, warmer weather. Not always the easiest as the INS and IRS are not your friends. But then you can live in Missippi and Alabama where it is cheap and warm.

As the oil and gas is hooped, not likely gonna come back, Alberta is wise to be harvesting Marijuana with the canola. This should be the next big cash cow. Next years Stampede should be interesting.

#33 crowdedelevatorfartz on 07.25.17 at 7:26 pm

@#11 GTA Refugee
“They all laughed at me and told me I was crazy for selling! it was summer 2016 and I just sold my 3 year new deatched house in Durham. It went up in value 240k.

+++++

Well done. Betcha they aint laughing now………

#34 Smartalox on 07.25.17 at 7:28 pm

@Keith #5:

A decision like the one made by PETRONAS is not made overnight. If they weren’t forewarned, the BC Liberals probably saw the writing on the wall, and took a calculated risk to let the NDP wear the blowback from this one.

Yes, there is competition from other projects in other markets. That was never the point: the goal of one of these things is to get these big, well-heeled global energy companies to build stuff and buy stuff and hire people and pay Royalties in your jurisdiction, and not the other guy’s.

Australia has decades of engineering incomes, field services contracts, food, lodging and transportation costs, as well as sweet, sweet royalty payments coming to it.

BC? Now, not so much.

#35 AJM on 07.25.17 at 7:34 pm

I understand Garth’s (and others’) position that the estimated 5% foreign buyers have done nothing to affect prices in Vancouver and Toronto. Respectfully, I think the issue is foreign money not foreign people.

If I was providing feedback to OSFI re their upcoming stress test it would be to determine if buyers can qualify based on their CANADIAN REPORTED INCOME.

Am not a huge fan of regulations in general, but I do think the Canadian gov’t and people deserve to know how much foreign money (untaxed in Canada) is flowing through our residential real estate market. Simplest way to do that would just be to link land title to tax return, but in the absence of that the OSFI test would add a ton of insight.

#36 Canada Real Estate Update on 07.25.17 at 7:36 pm

#5 Keith
#25 crowdedelevatorfartz

Petronas had made the decision earlier this year they will not be pursuing the LNG project in BC, however they waited till the elections in BC and till NDP came into power to make an official release. However if Crusty Christy had won the elections and became the premier Petronas would have never made this announcement, they would have just kept it pending (under review)and let Crusty Christy brag about LNG and prosperity fund till she was in power.

#37 Linda on 07.25.17 at 7:36 pm

#6 Michael King – I for one do not believe in anthropogenic climate change. What I do believe is that climate change is occurring & is exacerbated by human activity. Solely caused by our activity? Sorry, but I think that is placing far too much importance on just one factor. All those who complain & bemoan climate change seem to have no problems ignoring the fact that the planet has gone through a cycle of cooling/warming long before we ever were able to influence the outcome. To declare that we alone are the cause of what appears to be a reoccurring cycle is hubris. Get over yourselves & accept that things can happen w/o your mandate & will keep on happening despite all you can do. For reference, try the story of King Canute.

#38 Livin Large on 07.25.17 at 7:40 pm

Toronto is not Orlando. Well ain’t dat da troot.

It’s been ages since I had anything to do with mortgage underwriting but as I recall, Florida was one of five US jurisdictions where you could declare personal bankruptcy and not lose your principal residence so, boot the debt but as long as you made the mortgage payments you kept your house. With 30 year fixed US mortgages, that little loophole can go a long way to keeping a house that’s underwater. So such deal here though.

You can go bankrupt in Ontario and keep your house. — Garth

#39 Kram on 07.25.17 at 7:40 pm

#21 Mark on 07.25.17 at 7:12 pm

The liberals already called me and I educated them on GTA housing prices having peaking in 2012.

#40 D Apostrophe on 07.25.17 at 7:40 pm

Thanks for bringing up FLA. I lived and worked in Los Feliz/LA when it cratered. When I came back to Canada.. my 1st question to all my neighbors (I live in the baller district of Etobicoke.. many developers, mavericks and hedge fund managers.. maybe even Garth!) was: What are you guys gonna do up gere when you stop selling houses to each other? Well, I guess we shall know soon.. for one.. Toronto’s economy is basically RE+construction..(LA’s economy is one of the most diverse ,and 3rd richest city on the planet.. is Toronto even in the top 20?) as for the other prominent industries (if you want to call them that) technology and netflix are gonna kill those off as well. Sorry m’Hosers.. this is gonna be ugly for many. A perfect storm. And the one thing at the end that will be the reason Toronto gets levelled : Hubris.

#41 mike in Kelowna on 07.25.17 at 7:47 pm

Garth..Ozzy Jerrock ( self proclaimed global RE expert) said on Mike Campbell’s show on CKNW Vancouver last Saturday that this would not apply to people renewing mortgages, just new home buyers. You say :

The federal bank cop – OSFI – has proposed that everyone applying for a mortgage qualify for the loan at a rate which is 2% higher than the prevailing one.

Who is correct? You or the Oz?

P.S. I’m trying my best to keep up…

Where did I say ‘renewal’? — Garth

#42 Doghouse Dweller on 07.25.17 at 7:50 pm

#3 I thinks I know something

I do wish that I knew what the Elites have in store for us.
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

Agenda 21, The Plan To Kill You – David Icke

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

#43 Joseph R. on 07.25.17 at 7:53 pm

Blame the Qataris for the cancellation of the Pacific NorthWest LNG project. They are the world leaders in LNG exports and they are planning on boosting their LNG exports by 30 % in the next 5-7 years, courtesy of the North Field project:

“That new project will raise Qatar’s total liquefied natural gas (LNG) production capacity by 30 percent to 100 million tons from 77 million tons per year, Qatar Petroleum’s CEO Saad al-Kaabi told a news conference in Doha.

Global LNG demand was 265 million tons in 2016, according to Royal Dutch Shell’s annual LNG outlook.”

Source: http://www.cnbc.com/2017/07/04/qatar-ratchets-up-gas-production-30-percent-despite-sanctions.html

#44 Ken on 07.25.17 at 7:56 pm

As we talk about interest rate increases and how those obligations will be met in the future Most people don’t stop to think of the other increases such as ICBC (Car Insurance) rates in B.C may need to increase by 30% in the next 2 years. I guess at that point people in B.C will need to choose between their $80,000 unpaid for one ton and the two million dollar shack.
More kool aid please this should all end well..

https://roundhouseradio.com/2017/07/24/icbc-financial-crisis-mean-increase-insurance-rates/

#45 Mike on 07.25.17 at 7:57 pm

Garth,

We are special. Nothing can bring Canadians RE to 2014 levels.

My brother bought SFH in Vancouver for $1.1M 4 months back, and moved in 2 months after closing. 1 month after closing, and before they even moved in, next door sold for $1.2M. And dear realtor was pushing them to list for $1.25M before they even move in.

That’s a relatively recent and first hand update from GVR.

No stress test will work, it hasn’t.

#46 Short the TSX on 07.25.17 at 8:01 pm

The carnage hasn’t even started yet

#47 Porsche on 07.25.17 at 8:02 pm

Petronas pulls the plug on Canada’s Pacific Northwest LNG megaproject

There goes a 36B project and a ton of jobs

http://business.financialpost.com/commodities/energy/newsalert-pacific-northwest-lng-megaproject-not-going-ahead-2/wcm/f1661f34-d01e-439e-9311-cd404a3fc77d

#48 Lulu on 07.25.17 at 8:07 pm

Brrrrrrrr!!!!! I feel the chill, are we having an early winter, skip the fall ? Seems so eh!? Nothing is moving and sellers pull their listing off or let it sit pretty like my little chihuahua…lol

Yep, the coming stress test will kill it completely and those are in for the renewal, good luck if you can find a greater fool for your shack/slanty semi..

*Brace Brace Brace Brace, we are crashing, see ya there….lol

#49 Waiverless on 07.25.17 at 8:10 pm

#44 Mike

Did he buy it cash? House prices are the inverse of interest rates. Vast majority are limited to buying upto what the bank will lend… as rates rise this will go down. People can ego price as much as they want… credit tightening and interest rates rising will bring down prices… that’s a fact…

#50 Joseph R. on 07.25.17 at 8:12 pm

#2 Aaron on 07.25.17 at 6:43 pm
Tough news for the guys who were hoping to work on the Petronas LNG plant. On the other hand, it seems like it’s great news for North American LNG consumers. Australia has built several LNG plants to serve the markets in Asia and it is resulting in skyrocketing gas prices for Australian consumers (http://www.abc.net.au/news/2017-03-09/gas-prices-will-rise-and-there-is-not-much-we-can-do-to-stop-it/8340536). With the cold Canadian winters and heavy use of gas heating, I’d think that the resulting price increases could be devastating for Canadian consumers.

—————————————————

We do not depend on LNG in Canada: We have an extensive system of pipelines to supply our natural gas liquids needs for now:

https://www.neb-one.gc.ca/nrg/ntgrtd/trnsprttn/2016/cnds-ppln-trnsprttn-systm-eng.html

Only Nova Scotia imports LNG and it is around 1.7 M m3/day

#51 Howard on 07.25.17 at 8:15 pm

#44 Mike on 07.25.17 at 7:57 pm
Garth,

We are special. Nothing can bring Canadians RE to 2014 levels.

My brother bought SFH in Vancouver for $1.1M 4 months back, and moved in 2 months after closing. 1 month after closing, and before they even moved in, next door sold for $1.2M. And dear realtor was pushing them to list for $1.25M before they even move in.

————————————-

I don’t really consider Vancouver a part of Canada anymore. Just a resort city for rich foreigners. Sort of like Dubai but instead of oppressive women-hating stone age rulers, it’s full of oppressive man-hating cultural marxists. Smug know-nothing debt slaves serving coffee to foreign zillionaires.

In Real (non-Vancouver) Canada, it’s game on for a correction or, dare I say, a crash.

#52 No Sh!t on 07.25.17 at 8:18 pm

House was sold in North Van in June 2016 for $2M. House has been on the market since then for a flip. Was listed at $2.3M, then $2.1M and then 1.95M. Showed up on VRBO a few weeks ago. Then disappeared off MLS a few days ago. Then popped up elsewhere as Sold for $1.75M. That’s about a $350K haircut after all expenses. That’s about $500K pre tax income.

Could MLS be removing these types of (heavily discounted) homes out of their listings so that buyers don’t see the discounts? I bet they are.

#53 Millmech on 07.25.17 at 8:18 pm

#39 Mike
I hear that another small increase in mortgage rates is happening tomorrow.If this is true all the other big banks will raise theirs in lockstep also and do not forget about at least one more interest rate hike from BoC in the fall.I can see 7%+ mortgage rates in less than five years,I wonder how many people will qualify for those large mortgages being that with the stress test your interest rate could be at 9%?

#54 waiting on the westcoast on 07.25.17 at 8:20 pm

#18 Victoria Up 40% says… “You will be waiting half a decade for that 40% to disappear IF a correction ever gets started in the land of soggy brains…”

Hey – I agree with you that VREU has been spouting delusional stats hoping the market was moving the other way (reminds me of Mark’s 2013 peak market theory). For a long time Victoria had been flat and my hope was for it to start winding down (didn’t happen). That said, it has climbed significantly this past year.

However, as interest rates rise, Victoria and the Lower Mainland will get pummeled more than Vancouver proper. As I have pointed out a few times on the blog, it is mostly amateur investors and an influx of Vancouverites (who can buy a home for 50% of the cost in Vancouver in a better neighborhood) that have swollen the prices. I think we are looking at a 2 year drop followed by a slow decline for a few years. Victoria is not Vancouver (which is not HK)… Pain will soon ensue!

#55 bubu on 07.25.17 at 8:23 pm

TDSI says it’ll slow mtg growth up to 10% if it is going to be implemented…. market impact???? not a huge deal….

#56 mike in Kelowna on 07.25.17 at 8:24 pm

“Garth..Ozzy Jerrock ( self proclaimed global RE expert) said on Mike Campbell’s show on CKNW Vancouver last Saturday that this would not apply to people renewing mortgages, just new home buyers. You say :

The federal bank cop – OSFI – has proposed that everyone applying for a mortgage qualify for the loan at a rate which is 2% higher than the prevailing one.

Who is correct? You or the Oz?

P.S. I’m trying my best to keep up…

Where did I say ‘renewal’? — Garth”

Good point Garth…gonna have to brush up on my reading comprehension skills…Thanks…

#57 Jonston on 07.25.17 at 8:24 pm

Calgary now feels like a buyers market for the first time in years. From the perspective of a long time resident there is good and bad to this.

The good: less traffic, less chaos, less short term residents s***ing on the place and leaving.

The bad: if you own a house or especially an investment condo, you aren’t getting what your asking for it.

Here is a timeline summarizing the Calgary housing:

2015 – Everything is crashing, its bad. But lets remember the last time it crashed and how it came back. Stick with the high price.

2016 – S*** lets wait another year, we can tough it out. There must be a buyer out there.

2017 – No tenants to fill your crappy rental house or condo, or tenants leaving for less expensive ones. Residential and commercial vacancy rates at all time highs…..have to drop the price to get any action.

2018 – Final acceptance oil is not going back to a 80 any time soon…..sellll at any price.

#58 Maldroit Monkey on 07.25.17 at 8:25 pm

@Aaron

Funny you mention LNG in Australia how much of that rise in prices is to cover the massive mistake of investing into LNG in the first place ? http://wolfstreet.com/2015/09/21/australias-mega-lng-projects-are-in-serious-trouble/

The Carbon Bubble pops…

Pray for Alberta they are on life support. If they elect the Conservative and they curtail the deficit spending or the markets start to question how a province with 3 million people and an economy based on unprofitable resource extraction are going to pay back 10 billion a year in debt they are accumulating.

#59 Millmech on 07.25.17 at 8:26 pm

#39
Also to note a coworker is carrying a $900,000 mortgage and pays around $2500mth(so he says),if a new buyer wants to buy his place in five years carrying that amount of debt his stress tested payment would be about $7500/mth with the new OFSI rules.

#60 Howard on 07.25.17 at 8:27 pm

Hopefully the Site C dam will soon be scrapped.

I am not opposed to resource development by any means – I support a pipeline from the oil sands to tidewater. Who wouldn’t be when it’s safer and more economical than transport by rail? (know-nothing socialists, that’s who).

But the Site C was approved with virtually no environmental impact assessment and will be destructive on a massive scale. When Krooked Kristy narrowly lost I was happy not just for what it means for BC’s real estate industry but also for the prospect of scrapping that horrible project.

#61 dakkie on 07.25.17 at 8:30 pm

Triple Lutz Report #419 – Vancouver or Bust

http://investmentwatchblog.com/triple-lutz-report-419-vancouver-or-bust/

#62 oncebittwiceshy on 07.25.17 at 8:32 pm

Mike: “No stress test will work, it hasn’t.”

Mikey doesn’t like it. Okay, buds, let me help you out. When OSFI introduced their last qualification measures there wasn’t an appreciable change in the market because ….

The amount of non insured mortgages practically doubled after they brought in their previous qualification rules and not because everyone all of a sudden came into money, either.

That 20% line was crossed with subprime loans as well as mommy and daddy trying to ensure that their kids could qualify for financial perdition.

This one will be the nail in the coffin.

#63 -=jwk=- on 07.25.17 at 8:37 pm

Toronto isn’t like Orlando. Orlando lost Fannie Mae/Freddie Mac. Toronto still has CMHC.

Buy now, you’ll never get a better deal….September will be too late.

#64 Chillwinston on 07.25.17 at 8:41 pm

How is Vancouver wobbling ? 57% off do condos are selling above asking price. Detached is still hot. It’s. it even a buyers market

#65 Pete from St. Cesaire on 07.25.17 at 8:41 pm

#3 I thinks I know something
I do wish that I knew what the Elites have in store for us.
———————————————————–
Well it’s time you started learning. First of all; stop believing that so called ‘conspiracy theories’ are bunk. Most are not. Put lots of time into learning. You must have a good brain or else you wouldn’t be reading this blog. Learn about Agenda 21, the city of London, the FED, 9/11 being an inside job. Listen to people like Lindsey Williams, William Cooper, Jon Rappoport, etc.
Don’t just dismiss it all and then say “I wish I knew”.
Here’s a simple one: study WTC building 7. It’s the easiest ‘conspiracy’ to prove.

Tin foil alert. — Garth

#66 OSFI Changes on 07.25.17 at 8:43 pm

arth..Ozzy Jerrock ( self proclaimed global RE expert) said on Mike Campbell’s show on CKNW Vancouver last Saturday that this would not apply to people renewing mortgages, just new home buyers. You say :

The federal bank cop – OSFI – has proposed that everyone applying for a mortgage qualify for the loan at a rate which is 2% higher than the prevailing one.

Who is correct? You or the Oz?

P.S. I’m trying my best to keep up…

Where did I say ‘renewal’? — Garth

———–

So, the new OSFI rules will not even impact those renewing who have years of equity. So once again, the change will only target new buyers.

It sounds just like the new 5 year stress test that was supposed to wipe out 15-20% of buyers – which never happened as sales and prices went through the roof.

Not worrying about this minor change. Now if it targeted those a renewal, it might have some impact.

If implemented, it will target all buyers not just new ones, and be impactful. — Garth

#67 akashic record on 07.25.17 at 8:45 pm

#8 Ketch on 07.25.17 at 6:57 pm

When are First Nations not in a funk?

—-

Ever since the uninvited invaders robbed them from their land, their way of living, their culture, made their customs “illegal”, ripped out their souls one child after the other.

We are all just guests here.

Even if you pretend the opposite.

#68 I believe everything on television on 07.25.17 at 8:50 pm

This test will apply to all – no matter how large the down payment or if you’re applying for CHMC insurance coverage.

is there anyone here who actually believes the absurdity of the above statement?

Read this. You will sound less stupid. — Garth

#69 M-cube on 07.25.17 at 9:01 pm

Garth, the fact that people are upset that an LNG gas facility went bust is a testament to the claim that I’ve publicly made: It is that the vast majority of people lack any sort of creativity in their approach to life.

If an LNG gas facility is the best economic stimulus that a healthy, educated, vibrant population can make….then too hell with that same population!

Politicians, business leaders, and mindless voters need a swift kick in the ass to start approaching life with more intelligent creativity. Full stop.

Whoever said it was ‘the best economic stimulus’? Arguments made in extremes are weak ones. In the real world we need all kind of economic initiatives, and having a gas plant around would have assisted many thousands of your fellow citizens. — Garth

#70 BC_Doc on 07.25.17 at 9:04 pm

1). “Well done, Canada. Now all those construction guys, pipefitters, engineers and armies of contractors can enjoy a low carbon footprint serving lattes on Robson Street. One more little nail in BC’s real estate coffin.”

The salmon, the river, and the trees will thank us. Here’s to making money off a sustainable economy here in BC, not from replacing broken windows.

2) “Anyone born after 1960 has no idea what this might mean.”

Born in Boston in 1966 Garth. Call me a political geek, but I remember 25 cent gasoline (a gallon, not a litre), kids in the backs of herses coming “home” from Vietnam passing my neighbourhood on their way to the cemetery, Nixon visiting Boston, Jimmy Carter stagflation, and “Morning In America” under Ronald Reagan. My parents were children of the Great Depression and my dad told us stories about it growing up– enough to make me want to live like the Ant and shun the Grasshopper.

Cheers,

BC Doc

#71 acdel on 07.25.17 at 9:06 pm

#5 keith

No the NDP does not control world prices but what they specialize in is making it as difficult as possible for these projects to go ahead, wake up!

Canada is not a cheap place to live, these so called red-necks built this country; now what??? It takes time and lots and lots of money in the second largest country in the world with so little people residing in it; you are so delusional and so full of crap, the scary part is that you beleive in what you say, fast forward 10 years and see how all these failed deals will affect us… Be prepared to pay a whole lot for health care!!

#72 Smoking Man on 07.25.17 at 9:06 pm

Agenda 2030, wipe out the middle class, destroy western culture, class and Gender warfare. One world Govt run by appointees. Will attempt to distribute western wealth to the third world but as absolute power corrupts absolutely some one is going to get supper rich and the starving Africans will starve faster.

Its in my book Deplorables. The sequel tells you what to do to prepare. Problem is with my shit work ethic it will be to late to help anyone.

Feel free to ask me questions here.

Dr Smoking Man
PhD Herdonomics

#73 I believe everything on television on 07.25.17 at 9:07 pm

#67 I believe everything on television on 07.25.17 at 8:50 pm
This test will apply to all – no matter how large the down payment or if you’re applying for CHMC insurance coverage.

is there anyone here who actually believes the absurdity of the above statement?

Read this. You will sound less stupid. — Garth


I have no difficulty recognizing fear mongering and propaganda. Why not explain how this will apply to a buyer who has 75% down? You can’t because it wont, therefore the statement is in fact ‘absurd’

It will, according to OFSI. All loans will be stress tested. — Garth

#74 common sense on 07.25.17 at 9:11 pm

“Interest rates are going to go way up.”

Yes, over a looooong time… Do you really think we will see even a 1% increase over the next 2 years?

4% in say 7 to 8 years?

All of us have been calling for a big housing correction for years, it is starting but it went on far longer than most of us ever imagined. Thus, interest rates may be going up but very, very, very slowly…

The average tightening cycle is five and a half rate increases. That would move the BoC rate from 0.5 to above 2%. Very consequential. — Garth

#75 common sense on 07.25.17 at 9:14 pm

#71 Smokie

Why not post a Deplorables survival tip nightly here?

We have under 17 years to 2030.

Let’s get it started.

#76 Millmech on 07.25.17 at 9:15 pm

Re#39 should have been for #44

#77 M-cube on 07.25.17 at 9:16 pm

@ 7 Keep calm and mow the lawn

Your comment on the OSFI is too funny and too true lol

#78 Millenials on 07.25.17 at 9:16 pm

This is a compelling argument for why people are sceptical that interest rates can rise above 3+%.
With the current debt levels and low growth for foreseeable future past models are no longer applicable. Unless you truly believe that the USA can achieve 3+% growth for a sustainable period of time something will have to give.

https://realinvestmentadvice.com/how-big-of-a-deleveraging-are-we-talking-about/

Go ahead and believe what you wish. But the era of historically cheap money is so done. — Garth

#79 Wake up Cowtown on 07.25.17 at 9:18 pm

In the last two years, my rent in Calgary has gone from $1400/month to $900/month. I keep talking my landlady down and she keeps agreeing because she’s too afraid I’ll leave and the place will be sitting empty.

It’s a valid concern on her part. And a good bargaining chip on mine.

This town is sinking, but it has a ways to go!! You walk past all those brand new high rise condo buildings downtown, and you can see all the bare balconies. But they just keep building them!! In a town with negative population growth. Sigh.

A lot of people downtown still think that oil and gas has always been boom and bust and the boom will return. How can anyone still think THAT? Especially after what happened with Petronas today? Seriously. Wake up to the new reality.

And Kinder Morgan will be the next project to fail.

#80 the Jaguar on 07.25.17 at 9:19 pm

“Meanwhile, in Albertastan…
The socialist government in Canada’s most capitalist province keeps telling people the worst of the recession is over. ”

Well,… I guess there is a backhanded compliment in that statement somewhere. Yes, we are a capitalist bunch here in Alberta. Self preservation, pulling ourselves up by the bootstraps, etc. History taught us self sufficiency after the bond default where the Federal Government stood by and did not offer a helping hand to Albertans. We have long memories here. Revenge is a dish best served cold, and it will feel the same way when old ‘friends’ come knocking again.
Glad we could send some firefighters your way, B.C.

The ‘net migration’ figure cited is mostly due to the fact that for the past 40+ years the province has been the recipient of people from other provinces looking for work, many of whom just pissed their earnings away and did not put down roots in the province. They could leave easily with no ‘stake’ in the province . They left because they had no attachments and returned to NB., NFld, BC interior, etc. They are CarpetBaggers. They know it and we know it. It’s old news. Witnessed before in other downturns. There is little alternative available to them when we have invited so many temporary foreign workers to work jobs that may have kept them afloat while they considered other options. The cool down has more attractive features than many might imagine. The fat gets trimmed. Individuals and business become more fiscally self aware. It’s an eye opener for everyone as we enter a new age. Every business whether in Alberta or not, whether commodity driven, retail, financial services, or media will need to reinvent, reinvest, and act with swift reflexes to avoid collapse due to disruption.
“Give me land, lots of land under starry skies above, –Don’t fence me in…..
Let me ride in the wide open country that I love….
Don’t fence me in…..

I forget the next verse…

#81 acdel on 07.25.17 at 9:20 pm

#71 Smoking Man
No questions; I just agree with what you said! Humanity is so stupid at times; never seem to learn from the past!!

#82 Smoking Man on 07.25.17 at 9:25 pm

DELETED

#83 Keith on 07.25.17 at 9:31 pm

@ # 70 acdel

If by difficult you mean they’re against using public money to subsidize private business a la the B.C. Liberals, you’re correct. But if you can’t cut it without public subsidies on electricity and employment, it’s not really free enterprise.

Feel free to google B.C. LNG and tax/royalty cuts for a start. Then google B.C. LNG, Site C dam and cut rate power for the LNG business.

You see, the problem socialist have with free enterprise goes back to the old Tommy Douglas saw, “It’s rarely free and never enterprising.” In Canada, capital foreign or otherwise is not invested until the taxpayer backstops the downside. Norway knows better. Look up Norway sovereign wealth fund if you don’t understand. Christy Clark promised an elimination of public debt, and a 100 million dollar sovereign wealth fund with LNG. Right wing politicians really and truly suck on the economics and the dollars.

#84 jim on 07.25.17 at 9:32 pm

#23

“Toronto has a diverse economy including finance, tech and media”

I’m dying of laughter here. Toronto a tech hub? Nonsense. If you go to downtown seattle you’ll see tall buildings occupied by amazon and uber (etc). In San Jose you’ll find Adobe and Ebay.

In Toronto, all the big buildings are owned by banks or government. Hospitals, crappy accounting firms like KPMG, provincial ministries, banks.

Toronto lives on government jobs, with some finance and law jobs thrown in. The ‘tech’ in Toronto is almost irrelevant. OpenText is hardly funding half the city. Toronto is basically a core consisting of government, some finance, some media, service companies (e.g., law firms, accounting firms)… and then suburbs full of ethnic restaurants and warehouses to store imported Chinese goods.

#85 I believe everything on television on 07.25.17 at 9:35 pm

It will, according to OFSI. All loans will be stress tested. — Garth
—-
I think its fair to say that people with massive down payment dont ‘need’ mortgages, they just want mortgages,
If we accept: the larger the down payment, the ‘safer’ the loan, People with high down payment will shun being stress tested and go to alternate and private lenders, those lenders will get the cream leaving the big banks with loans of lesser ‘quality’.
OSFI is the ‘problem’ not the credit worthiness of the buyers, it’s a classic ‘switch the blame’

#86 Willy H on 07.25.17 at 9:36 pm

Just wanted to correct my post. My grandfather worked for Royal Trust Real Estate in the late 1970’s early 80’s not Canada Trust RE (which never existed!).

#87 Mattl on 07.25.17 at 9:44 pm

Orlando is NOT like Toronto. RE is local and Orlando is no more TO then Saskatoon is Paris. TO’s comparables would be NY and Chicago.

The cities that got crushed in the US share nothing in common with the GTA. Would love to see someone make the case that Queens Creek, a city that employs no one is comparable to Missisauga, a city that has jobs galore.

But the humans are the same. They all think it’s different where they are. You just proved it. — Garth

#88 Long Branch Apprentice on 07.25.17 at 9:50 pm

Smokey, get a move on with that book. If you’re stuck go find a 19 yr old uni kid and buy his Adderall from him. Performance enhancing substance for writers, so I hear.

The seeds of Canadian Nationalism are being sown in the bloated corpse of what Canada used to be. Every motion has an opposite and equal reaction. Simple physics.

SJW’s everywhere are pissed, but they don’t actually know why. They are too distracted by Snapchat to realize their quality of life has been slowly and steadily eroded like a popsicle on a hot July afternoon.

Just wait.

#89 Smoking Man on 07.25.17 at 9:50 pm

#81 Smoking Man on 07.25.17 at 9:25 pm
DELETED

Its not even 10 pm. Yeah started early.

Reflect on your last sentence. — Garth

#90 acdel on 07.25.17 at 9:53 pm

#82 Keith

I guess we have a different of opinions; I am well aware of Norway; if you choose to pay the same tax rate as they do and have one’s life controlled by their government then I say move there; I certainly do not! I want government out of my face, let me create a business and hire people without being taxed or regulated to death by fear mongering left wingers!!

#91 waiting on the westcoast on 07.25.17 at 9:54 pm

The average tightening cycle is five and a half rate increases. That would move the BoC rate from 0.5 to above 2%. Very consequential. — Garth

Garth – do you think we will see ~5 1/2 rate increases given its impact will be much higher relative to current rates than it would if we were starting at 5 or 8%, etc.?

That’s the average, but the BoC is starting late. The Fed has moved three times in seven months, so could be more. — Garth

#92 waiting on the westcoast on 07.25.17 at 9:55 pm

Or even scarier, will there be even more rate increases than the average???

#93 Millennial905er on 07.25.17 at 9:59 pm

#80 acdel

“#71 Smoking Man
No questions; I just agree with what you said!”

Ditto.

They’ve already destroyed Europe. Great podcast by Sam Harris:
https://youtu.be/HSWqwZXth0I

While my nutjob generation is arguing about which gender pronoun they want, the elites are laughing while they eviscerate Western Civilization/sovereign nation’s and remove any remaining liberties & freedoms. Soros and his ilk want a one world government which is why he funds social unrest through groups like BLM.

Sounds tinfoil but do your research… All true. And Depressing.

#94 DON on 07.25.17 at 10:02 pm

#25 crowdedelevatorfartz on 07.25.17 at 7:17 pm

@#5 keith

Total agreement.
Political wags of all stripes would roll their eyes everytime Christy Clark would prattle on ad nauseum about the “thousands of jobs” LNG would bring…..all while the Australians were ramping up their govt subsidized LNG plants.
Not to mention the US fracking creating…..A world wide glut of LNG…..hence the spiralling prices.

Todays announcement 1 week after the NDP took power?

Pure partisan theatrics.

One wonders what monumental lie Christy Clark would have spewed forth if she was still premier today.

Once again proving it doesnt matter what party is in power. Big business will do what ever it wants on the road to profitville.
************

Bang On!

Before the election Petronas was on track according to the idiot and her bloated henchmen. It was never viable – If it was why did it take 5 years? The Australians, Americans, Qatar, Iran etc. already had boots on the ground and operating infrastructure.

Australia is having serious problems in their LNG industry. Google is simple to use.

#95 lifer on 07.25.17 at 10:07 pm

Most people in the GTA have lived there all their lives. Tell me about someone who left Toronto or the GTA. Greatest place in the world when you have never lived anywhere else. Stockholm syndrome seem normal after time…

#96 Smoking Man on 07.25.17 at 10:16 pm

Been moving out of my house for 3 days now. My millenials kids came by for tocken effort and a free meal, and a claim to the long branch jackpot, they dont know about Seneca. I did most of the heavy lifting myself. These bisepts and chest mussels taking over saggy old man tits.

I’m tempted to go for a short term rental just for an honest evaluation from someone dependent on a drug fix.

I’ll stick with the mirror. Yes it bull shits me back.
Thats were the fun lies.

Talking to yourself. Screaming it even better.

#97 Ace Goodheart on 07.25.17 at 10:21 pm

Sitting up at the cottage trying to figure out why birds fly away from people when we walk towards them. I mean, it’s not like I’m going to eat a robin. I don’t want it as a pet. I likely wouldn’t even want to touch it. What is the big urgency? To get away from people so fast?

Then it just dawned on me as I was sitting here. These creatures love life. They cling to it. They fly towards it. I mean if the Smithsonian is right they are the last remaining dinosaurs. They pre-date the turtle, one of the oldest creatures on the planet. Maybe they know something we don’t? Birds after all have survived basically all of the great mass extinctions since creatures crawled out of the ocean and started living on land.

Maybe they are clinging to what has gotten them this far?

We working stiffs look, smell, act, feel like death. You want to see real life zombies, go watch the morning commute. We get so close to death we make organized activities out of it, and we call this “religion”. Millions of people are right now working towards their “retirement”, which is supposed to be a few short years of complete happiness, during which you do nothing and wait to die.

I’m sitting there thinking, no wonder that robin flew away from me. I must have looked like a creature that negated its entire being. Like grapeshot to the robin soul. Like the cops showing up at your 10th grade “mom and dad are in Florida and big bro bought some beer” party.

I get a lot of good ideas up there sitting by the lake. This has got to be one of the best ones.

I know understand birds.

And why people have to stop making slaves out of themselves to purchase things they don’t need, don’t want and can never even use. It would appear true happiness comes from actually being alive, and not from slavery, debt, work and thoughts of what happens after you die. That sort of path doesn’t seem to lead to better things.

At least, not for the robin…….

#98 Rational Optimist on 07.25.17 at 10:21 pm

6 Michael King on 07.25.17 at 6:56 pm

“Daily reader and big fan of this blog. I was very happy that Petronas cancelled the LNG project. I have two questions for you (Garth). 1) Do you believe that Anthropogenic Climate Change is real and that it is a serious issue? 2) If you do agree that it is real and a serious issue, what do you think should be done about it?”

I’m going to field these, with apologies to Garth.

1) Yes, of course.
2) Burn less coal and more relatively clean natural gas, in the short term. Invest in R&D in nuclear, and then use that in the longer term.

Natural gas is the cure for coal. One step at a time.

#99 acdel on 07.25.17 at 10:21 pm

#92 Millennial905er

You might enjoy this based on one’s opinion; your choice on how to decipher this!

http://investmentwatchblog.com/major-financial-catastrophe-ahead-for-europe-says-german-expert/

Why do you read such trash? — Garth

#100 Smoking Man on 07.25.17 at 10:21 pm

Reflect on your last sentence. — Garth

I have no idea what it was cause you deleted it. Doc gave pills for my b12 dificancay. No short term memory here.

#101 westsider on 07.25.17 at 10:41 pm

Neighbour just sold her house in westside Vancouver for $6 million. When we were turfed from our rental which was sold for $4.29 a year ago, I laughed because I thought that the off-shore buyer had bought at the top of the market and would get hammered. Not so…the money just keeps pouring in.

#102 BS on 07.25.17 at 10:45 pm

5 keith on 07.25.17 at 6:55 pm
So Petronas throws in the towel, and specifically points out that it is based on the economics of today’s prices and not on the change of government.

Of course it is based on economics. The government in power creates the economics for business. Those economics just shifted for the worse with the NDP /Greens in power. Higher carbon taxes, environmental regulations and a battle against business and natural resources in general. Now the economics don’t make sense. No reason for Petronas to call out the government. Everyone knows what happened.

#103 Leo Trollstoy on 07.25.17 at 10:46 pm

If the Liberals want reliable RE market information, all they need to do is pick up the phone and talk to people like Ross Kay or myself

Lulz

“Reliable info” from a person who thinks getting a job in IT is hard lol

#104 Chumpy le chump on 07.25.17 at 10:46 pm

Every day I wake up and reflect how grateful I am for selling in July 2016.

#105 Cici on 07.25.17 at 10:53 pm

#5 Keith

I’m with you on this one all the way.

Besides, there was no way that LNG project was going to get off (or out of) the ground. All just a “pipe” dream and political posturing to buy time for Crusty and BC real estate. Of course, the “cancelling” of it couldn’t have come at a worse time for the new government, but of course, that was deliberate and very political too.

#106 Deplorable breeding on 07.25.17 at 10:54 pm

#71 Smoking Man on 07.25.17 at 9:06 pm

Agenda 2030, wipe out the middle class, destroy western culture, class and Gender warfare. One world Govt run by appointees. Will attempt to distribute western wealth to the third world but as absolute power corrupts absolutely some one is going to get supper rich and the starving Africans will starve faster.

Its in my book Deplorables. The sequel tells you what to do to prepare. Problem is with my shit work ethic it will be to late to help anyone.

Feel free to ask me questions here.

Dr Smoking Man
PhD Herdonomics

..
The sperm count of western men is declining…..

http://www.cnn.com/2017/07/25/health/sperm-counts-declining-study/index.html

Soros and the new world order are lacing the water…

even more reason to stick to booze

#107 acdel on 07.25.17 at 10:54 pm

Why do you read such trash? — Garth

The same reason I read your blog from time to time; always good to get different perspectives, it is up to us to beleive what you or they have to say and decipher it for what it is; so what’s the problem??

#108 Cdn Mom on 07.25.17 at 10:58 pm

I was born mid-60s. I remember my parents had to renew their mortgage at 21%, when I was in high school. They only renewed for 6 months, hoping rates would be lower (and they were). Longest 6 months of our lives.

I have always had that in the back of my mind when purchasing a house, or getting credit.

#109 the Jaguar on 07.25.17 at 10:59 pm

Hate to keep you hanging:

https://www.youtube.com/watch?v=WLoYFvbR0XY

#110 BS on 07.25.17 at 11:00 pm

#27 OSFI Changes on 07.25.17 at 7:21 pm

What is the big deal?

The majority of new buyers do not have 20% down, so they fall under the current stress test of mortgages 2% higher than prevailing ones. And we have seen how effective that stress test was right? Right, prices went way up after being implemented…

Very few new buyers are uninsured.

Wrong. Actually the majority of mortgages are uninsured. The CMHC stress tests just pushed more people without 20% down (who didn’t qualify with the new stress test) to a private lender to get the 20% down to avoid the stress test. After the stress test was implemented CMHC mortgages plummeted 41%. The new stress test will kill that 41% plus any other existing low declared income in the conventional mortgage market like those with undeclared foreign income. Game over.

In its quarterly financial results posted Tuesday, the Canada Mortgage and Housing Corporation said that it insured just over 48,000 new mortgages between January and March, a 41 per cent decline from the previous three-month period.

http://www.cbc.ca/news/business/cmhc-mortgage-housing-1.4137986

#111 Mattl on 07.25.17 at 11:01 pm

But the humans are the same. They all think it’s different where they are. You just proved it. — Garth

Yes I do think markets are different. I think the guy in Maple Ridge that just bought the 900k mcmansion on a 5k sqft lot will feel more pain then the guy that bought a 2.5mm custom in Langley on an acre. I also think Van and TO are two of the only cities in Canada that have real economies and that they will bounce back from a correction then B markets. Orlando, Vegas and Phoenix got killed because of speculation AND lack of jobs, immigration, opportunity. Not sure what that proves, seems like a reasonable position to me. I’m hardly a RE bull, we just cashed in on our B market home.

#112 Raging Ranter on 07.25.17 at 11:04 pm

@#86 Mattl, Ask homeowners in Chicago how they faired in the last housing crash. Then tell yourself the GTA is different. Start here:

http://www.chicagotribune.com/business/ct-chicago-housing-recovery-0427-biz-20170426-story.html

Ten years after the crash, houses in South Chicago are as much as 45% below their 2006 peak values.

#113 Rates or Capital on 07.25.17 at 11:11 pm

‘But but but they are only 5% of the market and have no impact on prices…’

What a shocker!

According to BC provincial data, non-resident foreign buyers accounted for 10.5% of all sales in Richmond and 9.4% of all sales in Burnaby for the entire year.

https://betterdwelling.com/bai-bai-vancouver-bc-has-a-new-foreign-buying-capital/

Of course, before the BC Foreign Buyer’s Tax, the sales in two of the largest CITIES in greater vancouver were both over 20%.

So I guess an almost 50% drop is a start – unless, of course, those buyers found a way around the tax such as through the existing pre-sale loophole for condo purchases. But that would just be silly to contemplate.

Remember, the BC government data is the only reliable and credible data source. Realtor numbers are frankenumbers as so often acknowledged by all on this site.

But of course, nothing to see here folks. We all know that 10% of sales have no impact on prices….

Oh wait, they apparently have an impact only with condos and townhouse where 5% of buyers accessed the free money BC Home Buyers program and pushed condo and townhouse prices through the roof.

#114 Keith on 07.25.17 at 11:12 pm

#89 acdel

Let me create a business without being taxed and regulated to death – if only.
How about creating a business without vast amounts of free taxpayer money, grants and tax breaks that leave wage earners tax wise net out of pocket – the Canadian business way n’est pas?

What really burns left wingers is the vast amount of taxpayer sponsored lolly heaped on business owners who cry over taxation, over regulation on the ride to the country club.

BTW, if you are a small business owner, I feel for you in the sense that as a keen observer of politics, I understand that there have been more promises to small business broken than to any other constituency in Canada. That said, if you are a successful small business owner, you are making out like a bandit and paying a fraction of the working man/woman tax rate. And if you employ people in B.C., you are paying some low wages/salary – 50% higher in Toronto for a bachelor degree. Tough to make it in this province when your market makes chump change and pays the local cost of living – oh the dilemma.

#115 Spectacle on 07.25.17 at 11:12 pm

Just a long note in reply to:: Meet Agenda-21 and now, Agenda-30…..

“#3. I thinks I know something on 07.25.17 at 6:43 pm
I do wish that I knew what the Elites have in store for us.”

Since these supposedly non-binding international agreements can sometimes be a bit tricky to decode, what with all the weaponized buzz terms and semantics games, we’ve prepared a handy dandy translator on the 17 new Agenda 2030 goals below.

Goal 1: End poverty in all its forms everywhere
Translation: Centralized banks, IMF, World Bank, Fed to control all finances, digital one world currency in a cashless society
Goal 2: End hunger, achieve food security and improved nutrition and promote sustainable agriculture
Translation: GMO
Goal 3: Ensure healthy lives and promote well-being for all at all ages
Translation: Mass vaccination, Codex Alimentarius
Goal 4: Ensure inclusive and equitable quality education and promote lifelong learning opportunities for all
Translation: UN propaganda, brainwashing through compulsory education from cradle to grave
Goal 5: Achieve gender equality and empower all women and girls
Translation: Population control through forced “Family Planning”
Goal 6: Ensure availability and sustainable management of water and sanitation for all
Translation: Privatize all water sources, don’t forget to add fluoride
Goal 7: Ensure access to affordable, reliable, sustainable and modern energy for all
Translation: Smart grid with smart meters on everything, peak pricing
Goal 8: Promote sustained, inclusive and sustainable economic growth, full and productive employment and decent work for all
Translation: TPP, free trade zones that favor megacorporate interests
Goal 9: Build resilient infrastructure, promote inclusive and sustainable industrialization and foster innovation
Translation: Toll roads, push public transit, remove free travel, environmental restrictions
Goal 10: Reduce inequality within and among countries
Translation: Even more regional government bureaucracy like a mutant octopus
Goal 11: Make cities and human settlements inclusive, safe, resilient and sustainable
Translation: Big brother big data surveillance state
Goal 12: Ensure sustainable consumption and production patterns
Translation: Forced austerity
Goal 13: Take urgent action to combat climate change and its impacts*
Translation: Cap and Trade, carbon taxes/credits, footprint taxes (aka Al Gore’s wet dream)
Goal 14: Conserve and sustainably use the oceans, seas and marine resources for sustainable development
Translation: Environmental restrictions, control all oceans including mineral rights from ocean floors
Goal 15: Protect, restore and promote sustainable use of terrestrial ecosystems, sustainably manage forests, combat desertification, and halt and reverse land degradation and halt biodiversity loss
Translation: More environmental restrictions, more controlling resources and mineral rights
Goal 16: Promote peaceful and inclusive societies for sustainable development, provide access to justice for all and build effective, accountable and inclusive institutions at all levels
Translation: UN “peacekeeping” missions (ex 1, ex 2), the International Court of (blind) Justice, force people together via fake refugee crises and then mediate with more “UN peacekeeping” when tension breaks out to gain more control over a region, remove 2nd Amendment in USA
Goal 17: Strengthen the means of implementation and revitalize the global partnership for sustainable development
Translation: Remove national sovereignty worldwide, promote globalism under the “authority” and bloated, Orwellian bureaucracy of the UN

#116 Raging Ranter on 07.25.17 at 11:13 pm

@ # 96 Ace Goodheart, if you haven’t seen it, watch the documentary My Life as a Turkey. This guy found some wild turkey eggs and incubated them and raised them, and basically lived as a turkey, among turkeys, for a year. And he enjoyed every minute of it. I guarantee you that guy will never sit in rush hour traffic like a zombie. He knows the value of life. The turkeys taught him that. I $hit you not, watch the doc and see.

#117 DON on 07.25.17 at 11:13 pm

#18 Victoria UP 40% on 07.25.17 at 7:10 pm

Since we are all using ZOLO to assess the market, I guess we should not show the ZOLO stats for Victoria to VREU.

The queen of ‘sales are collapsing for two years with price declines around the corner’ would be floored with what zolo has to say about Victoria:

The asking price of homes for sale in Victoria has increased 40.00 % since July last year, while the number of homes for sale has increased 11.88%.

https://www.zolo.ca/victoria-real-estate

Yes, that is 40% in less than a year….again 40% in less than a year.

**********************************
“The asking price of homes for sale in Victoria has increased 40.00 % since July last year, while the number of homes for sale has increased 11.88%.”

So home owners are delusional and now listings have increased. What does this prove. What about actual sales? and not just in the trendy areas of Vic. Definitely not sure what you are getting at. I don’t see the wave of for sale signs, nor do i care what a greater fool is asking for a house. So today everything is great in Victoria…but what will allow it to remain great tomorrow? The over abundance of IT jobs, the booming local economy (building condos) or the invading foreigners.

Vancouver First in First out, Victoria – Last in, Last OUT. All aboard the bubble mentality train. Where greed and ignorance breed more greed and ignorance and reason , balance and logic are tossed out the window, only to return when the music stops, the curtain is drawn and pigs become wingless and start falling out of the sky?

Last call to board the Delusional Express. It’s gonna be one hell of a ride. Words that will become common soon…underwater, power of sale, foreclosure, divorced, and the favorite “Nobody saw this coming”. Just because you can’t see it doesn’t mean it’s not happening behind the scenes. Not happy about it as everyone suffers to some extent (financial, lack of customers, personal hardships, lack of good paying jobs etc).

I am not pissed about people buying houses. I’m pissed about the harm this will do to our economy, our collective future. The richest country in the world did not and could not avert a housing crash…but we will be fine…move along nothing to see here.

#118 Viorelli on 07.25.17 at 11:13 pm

While its very important to preserve our environment and leave some oxygen for the future generations, business needs of the country cannot be ignored. Canada, however is late as usual. While we debating our first nations rights, carbon taxes, green house gases, and trump policies others had already pushed us aside. Take China and Russia for example, the oil and gas is now shipped directly from Siberia into China by train, same with mining and forestry. Chinese are shipping their products back, the trade is done on their own terms as to eliminate USD involvement. Both are trying to expand their domestic production of numerous goods and services and shut out the outsiders. High tariffs on Kias, Mazdas, and other products (since there is a European restrictions in place), they are producing their own garbage cars, cheese, fruits and vegetables, clothing (China). At least it keeps their own people working and hurts the Japanese, Korean, and European exports. Smart policies must be implemented to keep your own people happy first!

#119 DON on 07.25.17 at 11:17 pm

#56 Jonston on 07.25.17 at 8:24 pm

Calgary now feels like a buyers market for the first time in years. From the perspective of a long time resident there is good and bad to this.

The good: less traffic, less chaos, less short term residents s***ing on the place and leaving.

The bad: if you own a house or especially an investment condo, you aren’t getting what your asking for it.

Here is a timeline summarizing the Calgary housing:

2015 – Everything is crashing, its bad. But lets remember the last time it crashed and how it came back. Stick with the high price.

2016 – S*** lets wait another year, we can tough it out. There must be a buyer out there.

2017 – No tenants to fill your crappy rental house or condo, or tenants leaving for less expensive ones. Residential and commercial vacancy rates at all time highs…..have to drop the price to get any action.

2018 – Final acceptance oil is not going back to a 80 any time soon…..sellll at any price

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

Nicely put, Jonston.

#120 TurnerNation on 07.25.17 at 11:18 pm

What kind of business is Home Crapital writing these days? They sold off billions in mortgages they hold. Why sell the good stuff…unless you wish to trade in the really nasty ones.

Maybe….maybe as everyone fails their stress tests HCG will again step in as subprime lender of last resort. This time going for the kill: Buffet and Boys buying up swaths of foreclosed properties?

See Blackstone (BX.US) which did the same down there. HCG smacks of an engineered crisis for elites to repurchase assets for pennies on the dollar.

#121 will on 07.25.17 at 11:18 pm

just want to thank crowdedelevatorfartz and NotAnAmericanNoMatterWhatUSAsays for their comments yesterday. Thank you, the understanding increases.

love, Will

#122 TurnerNation on 07.25.17 at 11:21 pm

…and the guard dog which didn’t bark (indicative of an inside job) , Genworthless, MIC.TO the insurer.
It’s stock price remains rock solid. What crisis for them?

#123 Suede on 07.25.17 at 11:25 pm

Left my cushy, defined benefit pension almost 6 figure job with crazy benefits to take a risk…

And started a business.

In the hopes my wife could stay home with 2 kids.

Wanted her to work part time for the small business while i gruel away 50hrs/week.

After 2 years did well enough that this might happen..

Now Trudeau wants to make us all employees and send my wife back to work.

Daycare and after school care for the kids is back on the table.

Eat the rich, my a$$

http://www.fin.gc.ca/n17/data/tppc-pfsp-eng.pdf

The feds are going to get a lot of letters from people like my wife and I.

Written comments should be sent to: [email protected]

T2 will turn us all into mediocre sycophants with no desire.

#124 Smartalox on 07.25.17 at 11:26 pm

#72: if someone has 75% of their purchases price as a down payment, the mortgage is only on the remaining 25%, so the stress test would be no trouble at all!

Of course, if a buyer can’t make ends meet with a tiny mortgage payment, they probably shouldn’t be buying that house anyway!

#125 DON on 07.25.17 at 11:31 pm

#59 Howard on 07.25.17 at 8:27 pm

Hopefully the Site C dam will soon be scrapped.

I am not opposed to resource development by any means – I support a pipeline from the oil sands to tidewater. Who wouldn’t be when it’s safer and more economical than transport by rail? (know-nothing socialists, that’s who).

But the Site C was approved with virtually no environmental impact assessment and will be destructive on a massive scale. When Krooked Kristy narrowly lost I was happy not just for what it means for BC’s real estate industry but also for the prospect of scrapping that horrible project.
*****************

I’m not against development either (Site C needs to have a solid business case). Shipping tar that sinks to the bottom of the ocean is plain stupidity as, all it will take is one spill to destroy a vast amount of sea life (due to our currents, some of the strongest in the world). Why not build some refineries and give Canada a competitive advantage by lowering fuel prices? Other countries are doing it…are we not capable? Do we lack the know how?

#126 crowdedelevatorfartz on 07.25.17 at 11:34 pm

@#666 Akashik skipping record
“Ever since the uninvited invaders robbed them from their land, their way of living, their culture, made their customs “illegal”, ripped out their souls one child after the other.
We are all just guests here.
Even if you pretend the opposite.
++++++
So….. when exactly does the white mans burden end?
When the taxpayers hand over $100 Billion A trillion?
I mostly work with 1st nations on a daily basis.
Excellent workers, proud of their heritage but sick of the pc correct bs.
As one of them said so eloquently to me a few years ago when we were talking about all the protests
, ” Whats the most expensive red wine in Canada?
” Its our land”

#127 Tony on 07.25.17 at 11:37 pm

Re: #27 OSFI Changes on 07.25.17 at 7:21 pm

If the value of their properties falls far enough the bank will ask for a lot more money upfront and if they can’t produce it then they have to either sell their house or transfer the mortgage to a third part lender at 7 plus percent interest.

#128 DON on 07.25.17 at 11:40 pm

#70 acdel on 07.25.17 at 9:06 pm

#5 keith

No the NDP does not control world prices but what they specialize in is making it as difficult as possible for these projects to go ahead, wake up!

Canada is not a cheap place to live, these so called red-necks built this country; now what??? It takes time and lots and lots of money in the second largest country in the world with so little people residing in it; you are so delusional and so full of crap, the scary part is that you beleive in what you say, fast forward 10 years and see how all these failed deals will affect us… Be prepared to pay a whole lot for health care!!
***************

If you care to do your research the deal failed a long time ago. Shell pulled out last year, others before. The price of LNG was too low and has continued that trend for the last 6 years (even at the time it was announce as an election gimmick and everyone bought in. If so lucrative a deal why did it not proceed when the BC Liberals were at the helm. The BC NDP did not campaign against LNG. Our beloved Rich Coleman (former BC Liberal Minister told us the deal would happen this summer). Stop the partisan bull shit and look at the details.

#129 Screwed Canadian Millenial on 07.25.17 at 11:40 pm

Garth, I’m sorry for calling you sweetie. I meant no offense. I was just kidding around. Didn’t know you would take it so serious.

For the record, I know you think I’m a racist. But I would remind you that I never bring up race. Go through my posts and see for yourself. It’s not about race. I’m against all TFWs, even white ones. I copied and pasted 3 article titles verbatim. CBC.ca, Vancouver Sun, and Financial Post. Mainstream sources. Why hold that against me?

So long as you are disrespectful your words will not appear here. — Garth

#130 Lightning McQueen on 07.25.17 at 11:46 pm

“Because interest rates are going up. Way up. The Canada five-year bond that was 0.5% a year ago is now at 1.65% and on its way to 2%. That’s a 400% increase in debt yield, and it will translate into, yes, 5% mortgages down the road.”

I enjoy your blog Garth. Sure looks that way for interest rates. But, as you know, from 0.5% to 2% is a 300% increase. Unless you’re using realtor math…

#131 DON on 07.25.17 at 11:50 pm

#96 Ace Goodheart on 07.25.17 at 10:21 pm

Thanks for that Ace.

#132 Van Isle Renter on 07.25.17 at 11:51 pm

#6 Michael King on 07.25.17 at 6:56 pm
Daily reader and big fan of this blog. I was very happy that Petronas cancelled the LNG project.

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

Me too. I can’t wait for our schools to close, our teachers and nurses to be fired, our roads to fall to pieces, our hospitals to close and for the NDP/Greens to send big fat tax payments to a Nigerian Prince who filled out a UN form stating that he is a climate refugee.

Sustainable tax revenue? We don’t need no stinkin’ sustainable tax revenue. We have a province that runs on fairy farts!

#133 NiceBeach on 07.25.17 at 11:52 pm

why suddenly many people are thinking about bankruptcy?:

https://trends.google.com/trends/explore?date=all&geo=CA&q=file%20bankruptcy

#134 crowdedelevatorfartz on 07.25.17 at 11:56 pm

@#143 Paul the annoyed realtor
“Well why don’t you just by a house and get it over with?”
******
Hmmmm.
Methinks “Happy Housing Crash Everybody” hath hit a nerve?
Deep breaths. Recapture your ‘happy place” .
Just go out and sell sell sell.
Doesnt matter if prices are dropping faster than Boomers thirsty diapers at a Canada Customs reentry from Thailand.
You need to flog overpriced, tanking real estate!
That Audi lease payment is bekoning….. burn the section that discusses “honesty and integrity” in that brutally difficult 6 week UBC Real Estate course…..because there wont be any questions on THAT in the govt exam.

http://www.google.ca/aclk?sa=l&ai=DChcSEwjGk4HdhabVAhWUXn4KHdd8B_EYABAFGgJwYw&sig=AOD64_1fZtxinwOvqfSGDPqUFjrDcRzGmQ&ved=0ahUKEwjKw_3chabVAhXilVQKHYTGC5oQ0QwIJw&adurl=

Just curious. When Ozzie shows up as a guest speaker…..do you all stand when you applaud?

#135 Alberta Ed on 07.26.17 at 12:04 am

Kudos to the NDP for killing another wealth/job creating megaproject — just like Harcourt did for Kemano Completion. There surely is a bountiful future for Wet Coast hobbits in knitting solar cells from seaweed to power all those electric bicycles.

#136 Looney Baloney on 07.26.17 at 12:06 am

#122 Suede

Lol keep sending ’em in, they are probably using them to line the kitty litter box.

#137 Wake up Cowtown on 07.26.17 at 12:12 am

To: Anyone out there that thinks they’re invincible against an impending real estate crash (AKA: Vancouver, Toronto, Victoria)

We once thought we were too.

Love, Calgary (AKA: once the richest province in the country)

http://www.therichest.com/expensive-lifestyle/location/the-top-10-richest-provinces-in-canada/

#138 Lee on 07.26.17 at 12:15 am

New home sales soar according to Star! Crash over.

#139 NoName on 07.26.17 at 12:17 am

#6 Michael King on 07.25.17 at 6:56 pm

Blogs resident anthropologist is usually here on a weekends after 9pm, just sit and wait if you questions your questions will be answered.

#140 Bob Dog on 07.26.17 at 12:38 am

I think this blog should be renamed.

‘On Globalization and the Concentration of Wealth.
1% for all and all for the 1%’

#141 Noid on 07.26.17 at 1:17 am

It’s only been a week of the NDP/Green government here in lovely Lotusland and projects are being outright cancelled (Petronas LNG) or are on the verge (Massey bridge, TransMountain pipeline, Site C Dam etc..).. Plus the ICBC debacle which will take a bite out of everyone’s wallet here(Libs mostly to blame for that one). Couple this with the fact that our new government will be spending like there’s no tomorrow and the future of RE here in the lower mainland and elsewhere in BC is not going to be very positive, even without taking into account rising interest rates and other measures being implemented to ‘cool’ the RE market. The populace here may start to become a little upset if their perceived home values begin to drop dramatically.

I hope Mr. Weaver and Mr. Horgan don’t get too comfortable as it may be a bumpy (and short) ride for them.

#142 T-Rev on 07.26.17 at 1:21 am

I’m worried about ‘Berta. Lived here all of my 35 trips around Sol. It’s not commodity prices I worry about- I’d rather have the world’s third largest oil reserves and low prices than no oil and high prices. If it’s not worth mining, they’ll leave it in the ground. If it is, low royalties are better than no royalties. What I’m concerned with is how unwinding from Dutch-disease utopia is yet to play out, and the long term impact of the socialists. So much money got driven into this province for so long that our cost structures are still out of whack, and we seem unable to reign in public deficits. And the NDP are posed to revamp labor laws and further deepen the carbon penalty to make business even less competitive here. Albertans are a industrious and entrepreneurial bunch, but we’re at risk of becoming a maritime province fiscally if we don’t get our house in order. The good news for now is that we still have decent jobs, high labor participation, a young population, the right culture, and incredibly cheap real estate compared to anywhere else in canada where you’d be able to find a job and would want to live. But we’ve got some painful years of adjustment to the new reality ahead of us.

#143 Rabbit One on 07.26.17 at 1:21 am

Remember, down payment to avoid mandatory CMHC insurance was 25%, not 20% just about 15~18 years ago?

Also, mortgage size was much smaller back then.
So, very comparable to justify your borrowed amount
vs: your income (like 2~3 times of annual gross).

Those years, CMHC (NHA) mortgage was mainly for young fellows.
Who can expects progressive income and has small down payment due to the age / years in career.

Underwriter always looked at 3Cs.

Credit (credit score, history), Capacity(income or other liquid assets) , and Capital (Down payment)

There were 2 more Cs.

Character (behavior on debts), and … sorry I forgot.

Those days are gone!
Agreed we lose perspective.

#144 Dolce Vita on 07.26.17 at 2:43 am

Honest to God, when will you YVR RE Cultists that post singular examples here wake-up and see the writing has been on the wall since October of last year, at least.

Here, feast upon how well your RE market is doing:

http://www.myrealtycheck.ca/

Prices have been dropping for quite some time and continue to drop (2:1 drops vs. increases, at best).

And no, it is not some +20 MM dollar property skewing the numbers. Just look at the “Multiple Change Properties” section. See any in there? The answer is no.

Buyers are exhausted. Why your condo market is flourishing and in undesireable areas where they are cheap – 1st time buyers back to the market. Which means, people trading up just selling to themselves without 1st time buyer support, and that’s your hot market?

#145 Dolce Vita on 07.26.17 at 3:30 am

Garth is correct on OSFI. Do some Math instead of waxing, pining and conjecturing.
____________________________

A $500,000 mortgage (cheapo property in YVR, $625K price, 20% down @ $125K):

2.5% fixed, 5 year amortiz.:

Mo. payment = $2340
If TDS @ 42%, then income needed: $5334/mo or $63,995/year (assumes only debt is a mortgage)

+2% stress test (4.5%):

Mo. payment = $2767
TDS @ 42%, income needed: $6589/mo or $79,067/year

An extra $15000/yr more in income needed.

In 2015, 4.4 million Canadians made $75000/yr or more. 8.74 million Canadians made $50000/yr or more.

Market size halved.
____________________________

$1 million dollar calcs ($1 MM price, $200K down, $800K mortgage – more like YVR RE prices):

Monthly payment @ 2.5% = $3584/mo, TDS income needed = $8533/mo or $102392/yr

+2% stress test @ 4.5% = $4428/mo, TDS income needed = $10542/mo or $126508/yr

An extra $24115/yr more in income needed, assumes only debt is the mortgage.

In 2015, 2.22 million Canadians made $100000/yr or more, 769000 Canadians made $125000/yr or more.

Market size more than halved.
____________________________

In Never Never Land, OSFI +2% stress test for all will have a minor impact on qualified buyers:

Realtor Math.
____________________________

Income Levels:

http://www.statcan.gc.ca/tables-tableaux/sum-som/l01/cst01/famil105a-eng.htm

#146 Toronto Dweller on 07.26.17 at 3:34 am

Thanks Ace, that was a good read.

#147 Oft censored and much maligned stock picker on 07.26.17 at 5:40 am

Petronas is only the most recent in a long line of international investors who have pulled hundreds of billions out of Canada. To maintain the unionized civil service pay scale taxes will have to ratchet up to the 100% mark…….and good luck with that. Capital flight has been a stunner unseen in this long lifetime of observing industrial Canada……wow…….where is the money going to come from to build schools and hospitals etc. I don’t hear any noise from Obama, de Caprio or Uncle Neil about feeding the seniors and housing the homeless now that the damage is done. Where are all those unionized wrench twisters and pipe monkeys going to work now that the Trudeau Liberals only create jobs for newcomers and specifically warn off Caucasians and not to apply? If you voted for this……WOW…..STUPID X’s INFINITY.

Internationally…..meaning US and China…..resources caught a bid…..XBM and Teck.b are big winners . Being a stock picker…I backed up the truck on Teck.

#148 EU industry is retooling on 07.26.17 at 6:24 am

Cars of the near future running on either electric or NG.

Audi’s line-up of models that are NOT gasoline or diesel powered cars is much better looking than Tesla (imo). Their production will be retooled at the moment and ready to pump out thousands of cars as opposed to the mini production that Tesla brags about. Ok, I’m biased.

EU governments have already mandated to go all out on those two types of vehicles as early as 2022. One million cars p.a. in Germany alone will have alternative engines. Legislation will make other engines less attractive. Government fleet vehicles will have new forms of engines.

LNG terminals being built everywhere along the coast lines of EU to bring supply into the continent.

http://www.lng.guru/first-german-lng-terminal/

This is a game changer for mideast oil as well as other oil dependent resource economies.

LNG in BC is a long shot. It’s too far from markets and the production is too far inland to make sense of it. There are better locations and NG is abundant.

Also factoring in the expansion of methane gas powered facilities across EU. There’s more than enough methane from cow shit in the Ukraine alone to power several large cities year round.

BC and Canada overplayed its role in that space. Canada’s East may have a future in exporting LNG to EU markets.

Then there’s the vast production of energy from solar and wind in the EU.

Energy markets have been turned upside down.

Also of importance is the next industrial revolution 4.0
Jobs and demand for skills are changing fast.

What is Canada doing other than talking about gender equality or carbon taxation?

#149 Smoking Man on 07.26.17 at 6:30 am

Hum. Will poloz spike again. The answer in the job numbers. Inflation dont count. They spike when you peeons are in a position to ask for a pay hike.

Everyone hates Hitler from 1939 to 1942 his crazy years. He was in power from 1922. 1922 to 1939 he broomed the central bank in Germany and the economy flew like a two headed bird.

You can’t beat the machine.

#150 Smoking Man on 07.26.17 at 6:47 am

DELETED

#151 Smoking Man on 07.26.17 at 7:00 am

Makes a stong case for leaving Canada.
Mentally I’ll people running the show.

https://youtu.be/je65790syn8

#152 Ace Goodheart on 07.26.17 at 7:09 am

#14 Frank on 07.25.17 at 7:03 pm

“These are uninsured borrowers. — Garth”

This is true, however the banks are probably “too big to fail” so it ends up being the governments problem (and by way of connection to taxes, our problem) anyway. Remember what happened in the States.

#153 maxx on 07.26.17 at 7:23 am

““Uninsured that’s a sale of $325,000 and a mortgage of $260,000.

“Insured it’s a sale of $900,000, a mortgage of $835,000 plus an insurance premium of $33,400 for a total of $868,000.”

A difference of $575,000 plus costs, which good ‘ol CMHC and the BOC made available by which Canuckleheads could stroke their doughnut- scarfing, er, avocado toast eating egos via re.

And then……..once the borrowing reached critical mass and market “values” plumped, masses of “equity” were suddenly just sitting in the attic. Just waiting to be used for kitchen upgrades, vacays, designer crap and avocado toast.

It’s true, the banks told us so. Lots and lotsa ads with smiling, nay, delirious airheads galore parading colorful shopping bags….five to an arm.

Today, debt is a staple in the life and future of the standard Canucklehead – but the constituents of the spend have changed: rather than almost pure goods and services, a healthy proportion of the borrowed money is now spent on debt servicing. Ooooops!

How can this in any way be good for our economy? Our dollar?

Debt hobbles economic momentum. The mindset at all levels of participants becomes one of penny-pinching and cost-cutting creativity of the weirdest sort.

We are way past time for rate hikes and a return to common sense as well to restore value to money.

Sooner or later, the realization that savers and investors rule manifests yet again.

……..however today, the consequences of being in neither camp are far more painful.

#154 Trumpocalypse2017 on 07.26.17 at 7:36 am

NUCLEAR WAR ON THE WAY!!!!!!

http://www.msn.com/en-ca/news/world/north-korea-threatens-to-strike-us-with-powerful-nuclear-hammer/ar-AAoQ69W?li=AAggNb9&ocid=mailsignout

This is exactly what Trump has planned, a perfect distraction from his imploding White House.

Prepare

#155 A Reply to #96 Ace Goodheart on 07.26.17 at 7:49 am

“Sitting up at the cottage trying to figure out why birds fly away from people when we walk towards them.”

It’s really very simple: a fight-or-flight response of a prey species encountering a predator species.
https://en.m.wikipedia.org/wiki/Fight-or-flight_response
https://en.m.wikipedia.org/wiki/Predation

For more info on evolutionary biology, see Charles Darwin’s book On the Origin of Species by Means of Natural Selection, or the Preservation of Favoured Races in the Struggle for Life.
https://en.m.wikipedia.org/wbhiki/On_the_Origin_of_Species

John Keats wrote a poem you might enjoy: Ode to a Nightingale. It explores the themes you touched on in your comment: nature, transience, and mortality.
https://en.m.wikipedia.org/wiki/Ode_to_a_Nightingale

Yes, Flopster and M—F—, I know that I’m being pedantic again! Can’t help it! There’s so much low-hanging fruit! ;)

#156 MF on 07.26.17 at 7:53 am

Another Financial Post article confirms it.

GTA condos (all anyone can afford) still up month over month, and way up year over year. Demand is obviously still strong since money continues to be way too cheap, housing is still seen as the best investment, no one trusts the stock market, and renting is garbage.

I’m sure everyone’s rent has increased through the same period too, like mine has.

Anyways lets look at this Home Capital joke situation:

It’s clear these limousine liberals and champagne socialists are worried about housing falling, and are willing to assure Buffett (at least implicitly) that they don’t want the “middle class’s most important investment” to go down too much. I have read that means Buffett will most likely indirectly receive some form of taxpayer bailout if things go too south.

I also read the same thing happened when he purchased some US mortgage securities in 2008/2009.

So,

As the average person lost their house/shirt, Buffett profited big time from the bail out. No wonder he was a huge supporter of Obama/Democrats. No wonder why Trump was elected after he gave his support to Clinton.
MF

#157 Dan.t on 07.26.17 at 7:57 am

“Take two purchasers with $65,000 down.

“Uninsured that’s a sale of $325,000 and a mortgage of $260,000.

“Insured it’s a sale of $900,000, a mortgage of $835,000 plus an insurance premium of $33,400 for a total of $868,000.

“We’ve lost any sense of perspective. If you think that it’s an insurance policy and that somewhere there’s a big pot of money to pay any claims, that various governments haven’t already borrowed to pay for their favourite vote buying programs, you have more confidence than I.”

That point needs to get hammered home to Canadians but it seems most don’t care or understand it anyhow, price just go up forever cause it’s real estate.

I will be leaving BC soon to go back to Europe and on that front I am so happy. BC is beautiful but the people are smoking some awesome weed or they have a serious case of group think.

Even when I tried not to talk about real estate, I got dragged into a conversation. It really is all that BC people have to talk about. That is no joke. Real estate is the end all and be all of life there.

So, I just stopped trying to tell people my views on how insane everyone is there…because they look at me like I have 3 heads, and I feel like I am the one who doesn’t get it.

Simple points like how rising rates are correlated with debt (I suspect 35 year rising rate cycle, with a drop or two along the way but who know…overall upward for a while)

and super cheap and easy access to money has everyone chasing one asset that pushed prices up and it is still going on

the fact that gov policies are changing (at least I hope),

everyone and their dog is invested in Real Estate and they want more because the credit is still available for anything under 500k for now and prices only ever ever go up,

there is no supply because every BC resident on average owns a principle residence and a few “investment” condos, townhouses etc… and best of all,

really, 1 million dollar homes all over the lower mainland based on 80+k gross average household incomes, everyone acts like it’s just normal…

and yet seems like the party just keeps on going.

If I seem bipolar it’s because the real estate market in BC is extremely frustrating. Either rent from amateur landlord charging insane rents or mortgage yourself to debt servitude to one of the big banks- it’s probably better to take on 600k debt than have people find out that you rent.

I hope the next rate increase is 2% and CMHC forces banks to take on risk, shaddy government incentives to buy homes get wiped away, fraud, speculation and selling out to oversea buyers stop, then maybe the affordability crisis that won the NDP the province might start to change.

Banks must just love Canadians. I wonder how much debt is owed to the big banks. Debt pigs think they own their homes or condos, I guess we will see how friendly the lady at the bank is once rates start to rise and the speculation stops.

#158 -=jwk=- on 07.26.17 at 8:23 am

@ #122
http://www.fin.gc.ca/n17/data/tppc-pfsp-eng.pdf

This is great, thanks. Unfortunately for you it completely justifies the changes and does a great job explaining why.


The proposal would eliminate the tax deferral advantage on passive income earned by private corporations and Preserve the intent of the lower corporate taxes: support growth and jobs

#159 down and out on 07.26.17 at 8:31 am

For those born before 1960 you would not understand .Its because of the’ new math” taught in schools .No rigid answers ,no counting or percentage calculations are wrong ,just change the inputs to get the results you like .Life is like that too .NOT

#160 BR E19 1-D-1 on 07.26.17 at 8:48 am

Hey Garth –

I don’t get it. You start this blog with a rant about the lefties in BC, then the lefties in Ottawa, finishing with the lefties in Alberta. I know you hate Stephen Harper and you absolutely despise The Donald, yet both these guys are, at least nominally, right of centre and largely sympathetic to both business and home ownership, but you are always dumping on them, especially the ‘deplorable’ Donald.

As regards T2 – possibly the dumbest and least-capable PM Canada has ever seen, although arguably the cutest – he has another three years of so to make mischief and, given the current crop of opposition leaders, will likely see alt least one more term, if not more.

Bottom line: You will have plenty of things to gripe about for many years to come as bankrupt Canadian governments, both federal and provincial, find increasingly novel ways of separating Canadians from their money. You might even wish, as you noted the other day, for a Trump here. That would be the ultimate irony!

This blog disparages everyone, so relax. — Garth

#161 Alistair McLaughlin on 07.26.17 at 8:48 am

I also think Van and TO are two of the only cities in Canada that have real economies and that they will bounce back from a correction then B markets.

You really think Vancouver has a “real economy”? Besides real estate and drugs that is?

Orlando, Vegas and Phoenix got killed because of speculation AND lack of jobs, immigration, opportunity.

You really think Phoenix, Orlando and Vegas lacked jobs, income and immigration (immigration???) going into the financial crisis?

Do you just make things up to make yourself feel better?

#162 TurnerNation on 07.26.17 at 8:57 am

Misinformed people call the stock market a scam.
Yet anything you buy or sell on an exchange has guaranteed settlement. Your deal will close and your money returned. All done via Clearing Houses none which have experienced any failure in this continent.

Buddy of mine tried selling his investment condo in west end of TO few months ago. Didn’t close buyers walked. Can’t get any bites now Another buddy moved into new place and hopes to sell his old condo now also in west end.

Now you’se can’t leave?

#163 fixie guy on 07.26.17 at 8:58 am

“Insured it’s a sale of $900,000, a mortgage of $835,000 plus an insurance premium of $33,400 for a total of $868,000.”

Golly, it’s almost as if the CMHC’s mandate was twisted to serve the financial sector instead of Canadian social stability. And at the expense of social stability.
‘Economic miracle’, sure.

#164 IHCTD9 on 07.26.17 at 8:59 am

#156 Dan.t on 07.26.17 at 7:57 am
_____________________________

At least you’ve got the common sense to bail. It’ll be a long time before things change in the GVRD, and there’s just as good a chance change will come in a very unpalatable form.

If you read about the area, it’s all overdue to get flattened by a massive earthquake anyway. Way overdue actually.

There are just huge, massive piles of reasons to gtfo of the GVRD…

#165 Alba on 07.26.17 at 9:01 am

#143 Dolce Vita
I’m not sure how accurate the numbers are on Zola but check out the market stats for West Vancouver. According to them the detached housing prices have been going down steadily for at least a month and are presently hovering around -23% monthly, -27% quarterly and -21.7% yearly change. I don’t see it being addressed in the media at all. White Rock numbers look almost as bad.

#166 SpicyInTheBushes on 07.26.17 at 9:07 am

“Because interest rates are going up. Way up. The Canada five-year bond that was 0.5% a year ago is now at 1.65% and on its way to 2%. That’s a 400% increase in debt yield, and it will translate into, yes, 5% mortgages down the road.”

Would you recommend any modifications to the fixed income portfolio portions or leave the allocation as is, and take solace in the fact that at least the returns will be rising? We’re at the 60/40 split, most in bond ETFs, some REITs and dabbling in preferreds. I’m watching in dismay as our bond values drop, and I’ll admit I’m too big of a noob to understand whether to leave it be, or make small changes. Thanks from Albertastan.

Pay attention to the asset allocations this blog has suggested. Government bond exposure minimal – more in corporates or provincials. Preferreds should be 50% of fixed-income, and are rising sweetly. — Garth

#167 SW on 07.26.17 at 9:15 am

“Everyone hates Hitler from 1939 to 1942 his crazy years. He was in power from 1922. 1922 to 1939 he broomed the central bank in Germany and the economy flew like a two headed bird.”

Mr. Hitler was only in power as Chancellor of Germany from 1933.

From Wikipedia:
“Reconstruction and rearmament were financed through Mefo bills(bonds), printing money, and seizing the assets of people arrested as enemies of the State, including Jews. Unemployment fell from six million in 1932 to one million in 1936. Hitler oversaw one of the largest infrastructure improvement campaigns in German history, leading to the construction of dams, autobahns, railroads, and other civil works. Wages were slightly lower in the mid to late 1930s compared with wages during the Weimar Republic, while the cost of living increased by 25 per cent.The average work week increased during the shift to a war economy; by 1939, the average German was working between 47 and 50 hours a week.”

You should confine your diatribes to intergalactic business, dear.

#168 Ole Doberman on 07.26.17 at 9:30 am

http://www.bnn.ca/justin-trudeau-lands-on-the-cover-of-rolling-stone-1.814028

Looks like T2 has hit the big time, or maybe big top, on the cover of Vogue.

#169 SimplyPut7 on 07.26.17 at 9:39 am

Home Capital paid back the $2 billion credit line in full.

https://www.bloomberg.com/news/articles/2017-07-25/home-capital-repays-c-2-billion-credit-line-from-berkshire

#170 InvestorsFriend on 07.26.17 at 9:52 am

Low Tax Rates as Central Planning

Garth said “Preserve the intent of the lower corporate taxes: support growth and jobs”

****************************************
Hmmm central planning to create jobs and growth? Not sure Adam Smith would approve.

How about a simpler tax code that focuses almost entirely on collecting the needed revenue in a fair way? The more you earn (from any source) the more you pay? Get rid of the hundreds or thousands of special deductions and the average tax rate can plummet?

All these tax breaks for investors. You’d almost think the rules were set by the richer classes of people who are also investors. Almost?

Is that Mr. RRSP talking? The biggest tax break of eternity. — Garth

#171 IHCTD9 on 07.26.17 at 9:59 am

#141 T-Rev on 07.26.17 at 1:21 am
I’m worried about ‘Berta. Lived here all of my 35 trips around Sol. It’s not commodity prices I worry about- I’d rather have the world’s third largest oil reserves and low prices than no oil and high prices. If it’s not worth mining, they’ll leave it in the ground
___________________________________

Alberta Oil wealth circa 05-07 is gone for decades, maybe forever. You at 35 today, won’t work in that kind of market ever again. WCS always was bottom of the barrel quality and sold at a deep discount – ie. only in high demand when global markets and economies are booming. The other major Global producer with similar priced crude happens to be Venezuela, and you know what is going on down there right now. They also happen to have an “NDP” government in power right now too. The global economies are still in trouble after 10 years, and there is nothing on the horizon to even suggest this will be changing soon.

Oil markets are flooded due to economic contraction and Fracking technology, it would take a commodity boom much larger than what we saw in the mid 2000’s to even get to the same price point again thanks to the huge supply increase.

Half of Europe and South America is at/near default, China’s industrial build up is essentially done, everyone else is up to their eyeballs in debt with insane/dumb as rocks leadership.

Notley and crew will be eliminating any residual chance for prosperity in Alberta with every policy that makes business more difficult or expensive. She’s driving off what little investment there is, and making life more expensive across the board. You’ll be getting a PST if she keeps it up, stupid policy makes for broke governments.

You are right to worry, if you take a wide angle lens and focus on Alberta, you can determine that wealth is evaporating, and it’s going to stay gone for a long time. The minute you get too many broke folks living there, you’ll never get rid of “leadership” like Notley.

You then exist in a whirlwind of wealth and revenue destruction, new taxes, huge debt, and big deficits until the bond market shuts the door on borrowing. Keep watch on Ontario to see what is likely heading your way…

#172 NoName on 07.26.17 at 10:10 am

@MF you are so cry baby

https://www.youtube.com/watch?v=rq_0un5CPSo

#173 Dups on 07.26.17 at 10:10 am

Has anyone here read: How to Win Friends and Influence People from Dale Carnegie?

Good book, i wonder how many good people are still left in this busy as ever world.

#174 IHCTD9 on 07.26.17 at 10:14 am

#161 TurnerNation on 07.26.17 at 8:57 am

Now you’se can’t leave?

________________________

Get out the bats, I know a guy like this too. A customer, just bought in KW late last year. Couldn’t believe how much trouble he had getting a loan, guy is 50’s, newish immigrant, so/so job.

He never should have got that loan and now there’s the smell of singed equity in the air. Hopefully he can escape not too badly in the red before he retires.

More likely is he will end up another groaning half conscious beat down biker laying out on the sidewalk…

#175 Bobby on 07.26.17 at 10:23 am

Garth, it’s remarkable to watch you bash “T2” and the “socialists” almost daily.

Especially in consideration of the FACT that Harpo absolutely GUTTED you when he gleefully tossed your ass aside like he did.

This on top of the fact that Harpo increased the national debt to levels unheard of in Canada.

And that was AFTER Harpo inherited a budget SURPLUS from the libs. he squandered our tax dollars plain and simple.

But “T2” the “socialist” is the catalyst of doom according to you?

Have you forgotten Harpos Income Trust betrayal.

Have you forgotten Harpos G20 gestapo tactics.

Have you forgotten the gazebos and wanton spending by Harpo…. you know…. the guy who SKEWERED you royally.

The conservative mindset is a unique puzzle indeed. It almost seems Trumpian in nature.

You sound driven by ideology. I am not. It’s a simple matter of wishing common sense on our leaders. — Garth

#176 jane24 on 07.26.17 at 10:25 am

Well packing the bag here in the South of England to jet off for my annual month in Canada seeing relatives and friends. Will be hitting Montreal, Ottawa and TO. I am very excited at seeing change since my trip last year when the snowflakes were still in ‘we are special’ and ‘this is paradise on earth’ mode. I really do think that we Canadians are so delusional that we are off the scale. Note to self, travel even more.

I have friends who are Richmond Hill RE agents so keen to hear what they have to say off the record. Husband hopes that I don’t pick up another box of cereal there and yell ‘can you believe the price of this’ across the shop.

Will report back. Gatwick here I come.

#177 Keith in Calgary on 07.26.17 at 10:40 am

1 – While I don’t disagree with political risk being a major issue with Petronas cancelling their LNG project, as of 08/16 they had reported a 96% drop in profit, and announced even back then, that they are trimming some 50 billion of capex from their books in the coming years as a result. Hardly new info, and probably discounted by the markets already.

2 – There are no jobs in Calgary for oil and gas folks, but for everyone else there is plenty of work available. Companies won’t hire you if you have O+G experience on your resume, because they know you’ll just up and leave the moment things turn for the better…….and I don’t blame them. The HR manager at my company told me this exact same thing.

3 – I was a mortgage banker back in the early to mid eighties. We used to use the 3 C’s of credit as our guideline………character, capacity, and collateral. I’d wager that if I applied what I was taught as a desk analyst today I’d reject 75% of applications.

#178 Lily on 07.26.17 at 10:57 am

I suppose all the negativity coming out of Calgary is good news for the GTA though, judging by how low the vacancy rate seems to be and all the people who’re flocking back to find work in TO.

#179 Ponzius Pilatus on 07.26.17 at 11:24 am

#115 Raging Ranter on 07.25.17 at 11:13 pm
@ # 96 Ace Goodheart, if you haven’t seen it, watch the documentary My Life as a Turkey. This guy found some wild turkey eggs and incubated them and raised them, and basically lived as a turkey, among turkeys, for a year. And he enjoyed every minute of it. I guarantee you that guy will never sit in rush hour traffic like a zombie. He knows the value of life. The turkeys taught him that. I $hit you not, watch the doc and see.
————-
That guy must have been scared around Thanksgiving.

#180 WUL on 07.26.17 at 11:29 am

I’ve had it. Time for a rant. To be immodest, I have gained local fame for my rants. One example should suffice. Months ago, I unloaded around colleagues about the offensiveness of municipal councils opening meetings with a silly Christian prayer. Imagine being in the shoes of a Muslim or Jewish group seeking planning and development approval for a place of worship and being denied. Perception of bias.

Well, not 7 days later a Superior Court in Quebec ruled such silliness to be unconstitutional and days later municipal councils dropped the practice. Vindicated I was.

Today’s? Strive every day to avoid any reliance upon “Service” Canada. Service they ain’t. To the extent you can avoid CRA, Canada Pension Plan, EI etc., your quality of life will improve vastly.

My MP just got an earful via email.

Rant/Not Over. Merely the beginning.

#181 rainclouds on 07.26.17 at 11:29 am

#51 Mike

1: Ozzie is a shill, he has been shamelessly but consistently pimping housing for decades. Its always a good time to buy RE on Ozzies planet

http://harveyoberfeld.ca/blog/cknw-has-a-jurock-problem/

2: Michael Campbell has no proven track record in wealth creation But he “talks” a good game.

Neither are credible

#182 HaHaHA on 07.26.17 at 11:34 am

DELETED

#183 Tazi Bnu on 07.26.17 at 11:43 am

#6 Michael King on 07.25.17 at 6:56 pm
Daily reader and big fan of this blog. I was very happy that Petronas cancelled the LNG project. I have two questions for you (Garth). 1) Do you believe that Anthropogenic Climate Change is real and that it is a serious issue? 2) If you do agree that it is real and a serious issue, what do you think should be done about it?
___________________________________________
The hidden agenda that the environmentalist are trying really hard to hide, is that the only way to dramatically reduce carbon emissions is population controls, because everything a human does creates emissions. I remember a recent study that said by having one less child you would reduce your carbon footprint by more than anything else combined. So I’m assuming you’ll be trying for a Darwin award. You don’t need to die to get one. If not, then I don’t think you really believe Anthropological Climate Change is real, and you’re just trying to use science that’s out of your depth to push your political beliefs.

#184 IHCTD9 on 07.26.17 at 11:45 am

#94 lifer on 07.25.17 at 10:07 pm
Most people in the GTA have lived there all their lives. Tell me about someone who left Toronto or the GTA. Greatest place in the world when you have never lived anywhere else. Stockholm syndrome seem normal after time…
_____________________________________

Many have moved there for work as well. Several with whom I graduated HS with have ended up in the GTA for one reason or another.

I couple I know of started an escape plan within 10 years of being there, these seem to have morphed into retirement plans.

These folks bought in ~20+ years ago, and while they have always complained about all manner of GTA drawbacks, they have earned well, and will make a killing on their houses when sold – no matter what the market does. Then they will buy a beautiful property back here for retirement with the proceeds.

They are likely the last generation to get ahead by moving to the GTA at a time when great paying jobs were widely available, and housing was still reasonably affordable (but not cheap).

All of that is toast now – there’s not one bloody thing the GTA can offer that could improve my finances or lifestyle.

#185 Tazi Bnu on 07.26.17 at 11:52 am

#59 Howard on 07.25.17 at 8:27 pm
Hopefully the Site C dam will soon be scrapped.

I am not opposed to resource development by any means – I support a pipeline from the oil sands to tidewater. Who wouldn’t be when it’s safer and more economical than transport by rail? (know-nothing socialists, that’s who).

But the Site C was approved with virtually no environmental impact assessment and will be destructive on a massive scale. When Krooked Kristy narrowly lost I was happy not just for what it means for BC’s real estate industry but also for the prospect of scrapping that horrible project.
___________________________________________
It may have been horribly planned, but with the damage already done, and the money sunk into it, it’s best to complete it with changes to mitigate further damage. It will generate the power needed for all the electric cars, that everyone is wildly over-estimating, that people will buy. Also, it’ll heat all the homes that are currently on natural gas, for when the government bans the use of fossil fuels.

#186 Alistair McLaughlin on 07.26.17 at 11:54 am

@ #178 Ponzius, I saw the documentary mentioned. These were wild turkeys, Thanksgiving wasn’t an issue. Hunting season, however, was another story.

And mating season? OMG, I’ve never seen a man do that to a bird before. (OK, I just made up that last part.)

#187 Dups on 07.26.17 at 12:08 pm

What happened to the gov money that they rewarded to Khadar?

#188 Rexx Rock on 07.26.17 at 12:12 pm

That LNG means nothing.Its all about housing.Its booming in Victoria,Vancouver and Kelowna.Lots of great work with high wages so there is no worry at all.The only worry is finding a place to rent but with prices rising $5000 to $10,000 a month why would you rent.

#189 Doug t on 07.26.17 at 12:30 pm

here is another reason to worry

http://www.oftwominds.com/blog.html

RATM

#190 Sir James on 07.26.17 at 12:42 pm

“Tin foil alert. — Garth”
Aluminum foil is much more cost effective for blocking illegal government spying on citizens than tin.

#191 Josh in Calgary on 07.26.17 at 12:44 pm

#2 Aaron,
Canada is different than Australia. Most of our NG is produced in BC and Alberta. Right now the price of BC Gas is severely depressed since it lacks take away capacity. LNG would have returned the price of this gas to normal levels. Also, check your NG heating bills. I bet you only 1/3 of the bill is the actual price of NG. 2/3 is the price to deliver it plus admin fees.

#4 Keith,
PETRONAS may have decided not to go ahead based on the economics of TODAY, but they wanted to start building this thing 5 years ago. You know, when the rest of the world was building their LNG facilities because the economic made sense. There was a window to build this thing and Canada missed it and that was due to the socialists that are anti-business. They don’t understand that you can’t delay and burden business to no end. Especially international companies who have a choice where to spend their money. There’s a balance between keeping industry in check so that it benefits everyone (not just those at the top) and strangling the goose that lays the golden egg.

#192 IHCTD9 on 07.26.17 at 12:49 pm

#115 Raging Ranter on 07.25.17 at 11:13 pm
@ # 96 Ace Goodheart, if you haven’t seen it, watch the documentary My Life as a Turkey. This guy found some wild turkey eggs and incubated them and raised them, and basically lived as a turkey, among turkeys, for a year. And he enjoyed every minute of it. I guarantee you that guy will never sit in rush hour traffic like a zombie. He knows the value of life. The turkeys taught him that. I $hit you not, watch the doc and see.

______

Here’s a guy who really had things figured out:

https://en.wikipedia.org/wiki/Richard_Proenneke

Parts of some of his footage are on YouTube:

https://www.youtube.com/watch?v=iYJKd0rkKss

Video series in called “Alone in the Wilderness”

#193 NoName on 07.26.17 at 1:21 pm

@ Bobby Bob

Have you forgotten Harpos G20 gestapo tactics.

That was liberal Ontario gov. Put law in place to give police power to detain at random if memory serves me correctly.

#194 Ace Goodheart on 07.26.17 at 1:28 pm

Re #154: “fight or flight response of prey to predator species”: when was the last time a person ate a Robin?

Seriously I can get the squirrels in the park to eat out of my hand.

But birds? No luck at all. I can’t imagine a time when people were eating robins and cardinals and sparrows. And yet they run from us like we have bird flu.

#195 waiting on the westcoast on 07.26.17 at 1:34 pm

#155 MF said… “As the average person lost their house/shirt, Buffett profited big time from the bail out. No wonder he was a huge supporter of Obama/Democrats. No wonder why Trump was elected after he gave his support to Clinton.”

MF – not sure where a lot of this vitriol is coming from but there is no conspiracy. Buffet does what Garth espouses and keeps liquid resources available when others have been not been prudent in their finances and then strikes a hard bargain.

He did not cause other people’s pain and in the case of HCG or Goldman in the US, it is his capital that saves their orgs from facing dissolution. He is not causing the individual homeowner their loss (or the banks he invests in). He is just getting a good deal when they are in a bind.

When you buy something on sale, do you feel like you cheated the company or other people who bought the same item at full value?

#196 MF on 07.26.17 at 2:12 pm

#171 NoName

Thanks I’m Canadian.

MF

#197 saskatoon on 07.26.17 at 2:19 pm

#174 Bobby

why do you insist on putting “socialism”?

it IS socialism!

T2 is the leader of a smiling gang of bureaucrats that initiate force against YOU to line their immoral pockets.

#198 jay #2 (not that one the other one) on 07.26.17 at 2:34 pm

#154 Reply to Ace Goodheart That wiki definition is a good description of the real estate market here in Vancouver.

#199 A Reply to #193 Ace Goodheart on 07.26.17 at 2:36 pm

It doesn’t matter what your intentions are. Birds having “their two eyes positioned on opposite sides of their heads to give the widest possible field of view are usually, but not always, prey animals”; they see you as a predator.

“… [T]here are only three extant groups of vertebrates with truly forward-facing eyes: primates, carnivorous mammals, and birds of prey.”
https://en.m.wikipedia.org/wiki/Binocular_vision#Field_of_view_and_eye_movements

“The tameability of an animal is the level of ease it takes humans to train the animal. Tameability may vary among individual animals, breeds, or species.”
https://en.m.wikipedia.org/wiki/Tame_animal

#200 maxx on 07.26.17 at 2:57 pm

#3 I thinks I know something on 07.25.17 at 6:43 pm

“I do wish that I knew what the Elites have in store for us.”

http://www.imf.org/en/News/Articles/2017/07/26/tr072417transcript-of-a-press-conference-on-the-july-2017-world-economic-outlook?cid=em-COM-123-35677

I’d be focused on industry 4.0, re-balancing of Chinese industrial output/commodity imports, global push to tighten on monetary policy and political black swans.

#201 IHCTD9 on 07.26.17 at 2:58 pm

#193 Ace Goodheart on 07.26.17 at 1:28 pm
Re #154: “fight or flight response of prey to predator species”: when was the last time a person ate a Robin?

Seriously I can get the squirrels in the park to eat out of my hand.

But birds? No luck at all. I can’t imagine a time when people were eating robins and cardinals and sparrows. And yet they run from us like we have bird flu.
____________________________________

I’ve fed totally wild Crows, Pheasants, Partridges, Blue Jays, and Turkeys by hand in the past.

I get the impression that if the food is tasty enough, they’ll push their luck getting closer and closer until they either grab the food, or they get startled and take off.

#202 InvestorsFriend on 07.26.17 at 2:59 pm

RRSPs and Other tax breaks for investors

Garth deemed my comment at 1690 worthy of a response.

Is that Mr. RRSP talking? The biggest tax break of eternity. — Garth

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

Yes, I am invested primarily in two RRSP which has given us a huge tax break and goes well beyond a mere tax deferral.

I did not set the rules and I am not doing anything unusual so I feel no guilt but I do think of it as a tax gift and not an entitlement.

I also have a fair amount of retained earnings invested in a corporation. One thing I don’t stoop to is income splitting. If I had legitimate work for the kids or spouse I would do that. But I am not about to put anyone on the payroll who does not do real work just to income split. Also I would not put shares of my business in the names of my spouse or kids which looks like tax evasion to me and anyhow seems likely to lead to trouble years down the road.

Frankly I was never sure why I am allowed to claim all my corporate income as dividends if I want. Clearly I do do work for my corporation. Why am I allowed to defer taxes on that by leaving it in the corporation?

#203 James on 07.26.17 at 3:22 pm

No, Toronto is not Orlando. Feel free to ignore this. You’re special.
________________________________________
They have the Mouse!
Toronto has this…………..
http://www.metronews.ca/news/toronto/2017/07/23/history-of-toronto-mascots.html

#204 Entrepreneur on 07.26.17 at 3:23 pm

WOW and well done #114 Spetacle…on the 17 points of the “supposedly non-binding international agreements can sometimes be a bit tricky to decode…” And not to mention the control from the people of a nation through consumerism to these agreements. And the common consumer to international agreements has taken away the everyday environmental concerns on the ground.

People on here complaining about their jobs in the LNG and Site C (their need jobs). Right now these workers want an income no matter what the environmental consequence (generally). When making big changes like this the political leaders have to make sure jobs are available elsewhere, for a smooth transition.

Interesting times ahead and we are changing.

#205 NoName on 07.26.17 at 3:26 pm

#195 MF on 07.26.17 at 2:12 pm

It took few seconds before it kliked in. funny!!!

#206 Sham the Sham on 07.26.17 at 3:32 pm

“The average condo cost $532,032 — 28.1 per cent higher than the second quarter last year according to the Toronto Real Estate Board….The average one-bedroom condo rented for $1,861 a month and two-bedroom apartments went for $2,533 between the beginning of April and the end of June.”

Good God, pathetic renters are so screwed!!

https://www.thestar.com/business/2017/07/26/toronto-condos-defy-overall-real-estate-market-slump.html

#207 Smoking Man on 07.26.17 at 3:40 pm

Freedom 58 just hit my bank account, let the adventure begin.

#208 InvestorsFriend on 07.26.17 at 3:43 pm

Petronas LNG project cancellation

Garth said:

This week the energy giant Petronas announced it ‘s throwing in the towel on a $36 billion LNG (liquefied natural gas) facility on the west coast.

#190 Josh in Calgary on 07.26.17 at 12:44 pm said:

PETRONAS may have decided not to go ahead based on the economics of TODAY, but they wanted to start building this thing 5 years ago. You know, when the rest of the world was building their LNG facilities because the economic made sense.

**************************************
We need to think about just how humongous $36 billion is. For context the entire Canadian energy sector was investing about $80 billion at the peak (much of it an over-investment actually). Here we had one project at $36 billion.

From the instant I saw talk of $36 and $40 billion (Kitimat) LNG projects back in 2013 I said no way. This would not be economic. Will never happen.

Had it been built the project would be broke now or whoever contracted to pay natural gas prices WAY above today’s market would be broke or hurting badly.

For the the sake of jobs, it would be great to build anything no matter the cost. But companies don’t do that. These mega LNG plants were obviously too expensive right from the start. There is a book called Blink about those things that you see and know at a glance must be simply wrong (like when you see Trump as President of the USA).

#209 Contrarian Coyote on 07.26.17 at 3:48 pm

#191 IHCTD9 on 07.26.17 at 12:49 pm
#115 Raging Ranter on 07.25.17 at 11:13 pm
@ # 96 Ace Goodheart, if you haven’t seen it, watch the documentary My Life as a Turkey. This guy found some wild turkey eggs and incubated them and raised them, and basically lived as a turkey, among turkeys, for a year. And he enjoyed every minute of it. I guarantee you that guy will never sit in rush hour traffic like a zombie. He knows the value of life. The turkeys taught him that. I $hit you not, watch the doc and see.

______

Here’s a guy who really had things figured out:

https://en.wikipedia.org/wiki/Richard_Proenneke

Parts of some of his footage are on YouTube:

https://www.youtube.com/watch?v=iYJKd0rkKss

Video series in called “Alone in the Wilderness”

===

His videos are great! Watching Proenneke build that log cabin himself is like a meditation for me ever few months. I heard his cabin has been preserved by the Parks Service.

On another note, I would love to read some follow up interviews from people who attended the Anthony Robbins/Pitbull real estate seminar last March. Surely some comedy gold mixed with a little heartbreak no doubt.

(http://www.theglobeandmail.com/report-on-business/rob-magazine/what-does-tony-robbins-know-about-selling-real-estate/article34810136/)

#210 InvestorsFriend on 07.26.17 at 3:52 pm

How to Win Friends and Influence People

#172 Dups on 07.26.17 at 10:10 am
Has anyone here read: How to Win Friends and Influence People from Dale Carnegie?

Good book, i wonder how many good people are still left in this busy as ever world.

*************************************
Dups, you are on to something good. That is a great and mostly timeless book. Written circa 1920’s I believe and written in the first person with vivid stories. (later editions have a few updates but not much)

I took the Dale Carnegie course. Like a few other analytically oriented people on this blog, I sorely needed it.

I enjoyed that book and read it again recently. I often joke to people who are being rude and arrogant to others “That book…, you still have not read it, have you?”

By the way, Warren Buffett is a Dale Carnegie course graduate and that, I understand, is the only certificate that hangs in his office. He said it changed his life. Gave him public speaking skills. And notice that Buffett almost never criticizes anyone by name unless they attack him publicly first. Praise in public, criticize in private, he says. Wise words.

#211 TheDood on 07.26.17 at 3:58 pm

#187 Rexx Rock on 07.26.17 at 12:12 pm

That LNG means nothing.Its all about housing.Its booming in Victoria,Vancouver and Kelowna. Lots of great work with high wages so there is no worry at all.The only worry is finding a place to rent but with prices rising $5000 to $10,000 a month why would you rent.
_________________________________________

LOL! This comment is either dripping with sarcasm or stupidity. I can’t seem to decide which one……

Am in shock over the Petronas decision. Job loss opportunities in the tens of thousands, revenue opportunity losses in the tens of billions……is this country really this stupid? Unbelievable!

#212 jess on 07.26.17 at 4:13 pm

not anon anymore?

July 26, 2017 / 8:28 AM / 2 hours ago
Greece arrests Russian suspected of running $4 billion bitcoin laundering ring

Karolina Tagaris , Jack Stubbs and Anna Irrera

https://www.reuters.com/article/us-greece-russia-arrest-idUSKBN1AB1OP

#213 Freedom First on 07.26.17 at 4:42 pm

#206 Smoking Man

Welcome to the freedom club Smoke!

Freedom First
Its my life

#214 jess on 07.26.17 at 4:56 pm

in shock over the Petronas decision?why? when….
1MDB: The inside story of the world’s biggest financial scandal

How a jailed former banker and a lone British journalist broke a story that shook the world

by Randeep Ramesh

https://www.theguardian.com/world/2016/jul/28/1mdb-inside-story-worlds-biggest-financial-scandal-malaysia

They have their own investigations going on
===============================
Abstract
Since 2008, a massive shift has occurred from active toward passive investment strategies. The passive index fund industry is dominated by BlackRock, Vanguard, and State Street, which we call the “Big Three.” We comprehensively map the ownership of the Big Three in the United States and find that together they constitute the largest shareholder in 88 percent of the S&P 500 firms.”

read more @

http://corpnet.uva.nl/

A new article by the CORPNET group has been published in the June 2017 issue of the Antitrust Chronicle (pp. 51-57). The piece, “The New Mandate Owners: Passive Asset Managers and the Decoupling of Corporate Ownership”, is written by Carmel Shenkar, Eelke Heemskerk and Jan Fichtner and can be found here.
——————————
head of Pakistan’s stock market regulator
Pakistan market watchdog chief arrested in Nawaz Sharif probe
First person detained in spiralling corruption scandal engulfing PM

Want to save thousands on your tax bill?

Ken and Martha are using a family trust to knock thousands and thousands of dollars off their tax bill. This is how do they do it.
http://www.smh.com.au/federal-politics/political-news/the-trouble-with-trusts-australias-multibilliondollar-legal-tax-avoidance-loophole-20170720-gxf3k7.html?utm_content=buffer14270&utm_medium=social&utm_source=twitter.com&utm_campaign=buffer

#215 crossbordershopper on 07.26.17 at 5:16 pm

reason to leave canada #2- invest in yourself not Canada. Nice 3 bed 2 bath SFH in Orlando for 169K, nice and with the dollar at 80.5 maybe even overshoot to 85 cents. no reason not to start your retirement early.

#216 Tony on 07.26.17 at 5:54 pm

Re: #164 Alba on 07.26.17 at 9:01 am

That’s an ominous sign for Vancouver real estate when the West end plummets. That will spillover to the entire Vancouver area and then to all the surrounding areas including Victoria.

#217 Aaron on 07.26.17 at 6:41 pm

#49 Joseph R.

Isn’t natural gas the stuff that is used to make LNG? If we start selling LNG overseas, it pushes up the price of natural gas in Canada as the demand has increased, but the resource is the same size. Basically, a small number of Canadians get a short term benefit from working on the LNG facility and the associated pipelines, and then for the foreseeable future every Canadian that uses natural gas for their heat/hot water gets to pay higher prices for their natural gas rates for no new benefit. It seems short sighted. If instead, we kept the natural gas over here, Canadian/North American consumer have lower heating costs and Canadian/North American companies have a cost advantage on power which helps to offset the higher wages paid here vs. Asia.

#190 Josh

Why would the vast majority of Canadians who do not work in the oil and gas industry want to pay higher prices for their natural gas? Every dollar that they don’t spend on natural gas is a dollar that they can spend on something they’d rather spend it on (e.g. keeping the house a bit warmer in winter, buy new clothes, go out for dinner an extra time, put a bit money into your retirement savings, etc.).

#218 Aaron on 07.26.17 at 6:44 pm

#210 TheDood

It’s not like the gas is going to disappear. We’re just deferring its use for awhile. The world is awash in LNG right now. Why not wait awhile and see if we can find a better use for that gas in the future.

#219 Ace Goodheart on 07.26.17 at 6:58 pm

RE: #200 IHCTD9 on 07.26.17 at 2:58 pm

“I’ve fed totally wild Crows, Pheasants, Partridges, Blue Jays, and Turkeys by hand in the past.”

Interesting. You must not be a wage slave, debt ridden, dreaming about the future zombie then. Perhaps you are to some extent actually living your life?

As I gradually move away from the horrors of careers and 9-5 and work till you die of something nasty, the birds seem to be getting friendlier.

I suppose the test for having reached pure happiness, would be if a robin or a sparrow would eat out of your hand. Accomplish that and you have actually lived.

#220 AGuyInVancouver on 07.26.17 at 7:12 pm

https://www.theglobeandmail.com/real-estate/the-market/vancouver-housing-market-showing-signs-of-overheating-cmhc-says/article35805257/
_________________
You’d still be stuck living in the craphole that is Orlando.

#221 Doug in London on 07.26.17 at 10:00 pm

@Aaron, post #217i:
My thoughts also. If the rest of the world doesn’t want our gas, then fine. We’ll let the rest of the world extract their gas, burn it all up, and save ours for future generations. While it doesn’t get as cold in the winter here in the Forest City as in other places I’ve lived, like Ottawa or Timmins, it still gets cold enough. Add to that the higher humidity makes it feel even colder. I know I’ll enjoy hearing the sound of that gas furnace firing up when I’m 80 years old and it’s cold outside, again made possible by not squandering our resources by selling them off cheap years earlier.