In praise of many

The sad, empty people who have no life and are addicted to this pathetic blog know the rules. Be balanced. Be diversified. That doesn’t mean owning two condos instead of one. Or having a spouse and a GF. And it sure doesn’t mean putting your faith in one stock, one asset or one house on one street.

The big lesson this week with the meltdown of FB. The world’s top social media platform was savaged by the markets Wednesday night and again Thursday – down 18% at the opening a day after reporting results. Ironically, the numbers were okay. Revenues up 42%. But the problem is FB’s hit a growth wall. Users are down. And with 20% of all the people on the planet signed up, there’s no place to grow. Poor Zuck.

While Facebook turned into Faceplant, the Dow was ahead more than 100 points and the S&P 500 was sitting on a year-to-date gain of more than 6%. Even one of the worst single-day stock plops in history by a global conglomerate was not enough to derail the entire index. The lesson: own all of them. Not one of them. Or even ten of them. Diversify, baby.

Here’s what portfolio manager Doug Rowat (the one without the Porsche) had to say when I asked him to parse FB for you:

“We think that because a company is well known, or even because we use their offerings every day, that they will never fall on hard times. But they do. Constantly. General Electric was down 45% last year even as the DJIA rallied 25%. What would be the odds of a blue-chip, industrial conglomerate getting hammered in the midst of a rapidly expanding global economy? But it happened.

JP Morgan actually researched the frequency of share-price collapses by examining the price action for securities in the Russell 3000 Index, a broad-based index of US equities. JP Morgan’s research showed that, over time, the odds of any one position experiencing a catastrophic loss—a decline of 70% or more from the peak with minimal recovery—were 40% and in some riskier sectors, such as information technology (hello FAANG shareholders), the odds rose to nearly 60%.

If you held a portfolio of only, say, 10 stocks, imagine how devastating it would be to have even just two or three of these positions plunge 70% at the same time?

And this trail of tears is not just a US phenomenon. Just ask Canadian investors who owned Nortel, BlackBerry (Research In Motion), Bombardier, Yellow Pages or Valeant Pharmaceuticals.”

Don’t buy US stocks. Or Canadian ones. Or Euro. Buy broad-based exchange-traded funds instead which hold an entire index. They are proxies for the economic growth of an entire nation or region, with the same liquidity and flexibility of an individual security, but far less potential volatility and risk. Companies can and do blow up, peter out, get distracted, lose focus, be outflanked or screw up. Economies, not so much. And the same ETF rule goes for bonds, preferreds, REITs and the rest of your portfolio. Don’t be a cowboy.

The average new condo in the GTA now costs $774,554. Seriously. That’s 23.5% higher than a year ago. At the same time, the average new detached house is almost 10% cheaper (at $1.13 million).

What’s going on here?

We’ll, it looks classic. When prices spurt higher on plunging sales it’s usually a precursor to collapse. Regarding new builds in the country’s biggest real estate market, the market is anything but healthy. New condo sales, the industry just revealed, have collapsed 61% year/year. Last June 5,290 units were snapped up. This year, barely more than 2,000 were sold.

Sales of single family homes, already crushed over recent months, were 19% lower than a year ago and (get this) 71% fewer than the 10-year average. And while just 421 singles sold last month, there is an unsold inventory of 4,848 units. As for new condos, the inventory is now 10,335 and last month alone 14 new developments broke ground.

So why are sales offices still jammed? Howcum half the new precons were snapped up in a few weeks?

Because there are still hundreds of thousands of moisters who want to indenture themselves for an eternity, throwing their entire net worth into a concrete box as a rite of passage into financial illiteracy. But the stress test and rising mortgage rates have thinned their ranks considerably. Sales are down, however delusion and naiveté are not. Now shut out of the new single market by the credit crunch this mob has turned en masse to condos, propelling prices to nosebleed levels. Three-quarters of a million for a highrise cube the kids could rent for a fraction of the carrying cost? Yikes.

If GTA condos were a stock, you’d know what to do.

144 comments ↓

#1 Leo Trollstoy on 07.26.18 at 4:14 pm

#MAGA!

#2 Leo Trollstoy on 07.26.18 at 4:16 pm

The average new condo in the GTA now costs $774,554. Seriously. That’s 23.5% higher than a year ago. At the same time, the average new detached house is almost 10% cheaper (at $1.13 million).

Bingo!

SFH prices peaked in the spring of 2017

Condo prices still going up!

$800/sqft or not, I guess I’m not selling

#3 Larry B on 07.26.18 at 4:20 pm

So much intrigue to get to the conclusion. Hey, I can’t afford a “real” house, what can (need to) buy. Crap, I can only get a Condo, I better get one before it is too expensive. People are mostly sheeple and are dragged into ruinous decisions. I have lost all hope in their insanity as Einstein quoted.

#4 JohnnyBoy on 07.26.18 at 4:22 pm

Poor Mark Zuckerberg lost 5.33 times what Donald Trump purported to be worth in one day. Yikes. There you go Grab em by the @#$$y.

#5 Phil on 07.26.18 at 4:22 pm

Danm! I’ve got to own a women’s modeling agency like Trump!

#6 MSM-Free Zone on 07.26.18 at 4:22 pm

Fake women.

#7 Chrisk on 07.26.18 at 4:27 pm

Good to become a landlord

#8 EU on 07.26.18 at 4:29 pm

Bitcoin ponzi all over again…775K for a condo? How can that be sustainable? OTOH, 25% extra over one year? Hard to beat :)

P.S. Really, who approves those mortgages?

#9 HT on 07.26.18 at 4:37 pm

Donny isn’t such a dumb guy after all.

#10 yvrmc on 07.26.18 at 4:50 pm

Boggles the mind how people can think that $750,000 plus , is a worthy investment money into tiny little concrete boxes …. its about land …

#11 The Real Mark on 07.26.18 at 4:51 pm

The Toronto condo market has crashed so much that only super-high-end luxury units are moving? Wow. Amazing. And totally predictable, given the gradual slowdown in activity post the 2013 plateau.

#12 Ubul on 07.26.18 at 4:53 pm

The guy in the picture seems to subscribe to the same investment school as you Garth, he seems to be nicely diversified. Lead by example, eh?

#13 Jimers on 07.26.18 at 4:57 pm

Facebook with eventually pay the price for being a Left-Wing political machine, topped off by Zuckerberg’s failed run for President 2020. A ‘social’ platform that does not allow conservatives to express opinions will never be considered open enough to be successful.

#14 FOUR FINGERS WATSON on 07.26.18 at 5:21 pm

So why are sales offices still jammed? Howcum half the new precons were snapped up in a few weeks?
…………………………..

Population increase every year. New immigrants coming every day. No end in sight. Tax free capital gains. Hop aboard this gravy train now. Don’t miss out. Surf’s up pal !

#15 Suse on 07.26.18 at 5:25 pm

Confused that on the one hand you state that:

“New condo sales, the industry just revealed, have collapsed 61% year/year. Last June 5,290 units were snapped up. This year, barely more than 2,000 were sold.”

And,

“So why are sales offices still jammed? Howcum half the new precons were snapped up in a few weeks?”

Aren’t these two statements contradictory?

#16 dakkie on 07.26.18 at 5:28 pm

Housing Prices Hit “Breaking Point” Leading To Collapse In Demand

http://www.investmentwatchblog.com/housing-prices-hit-breaking-point-leading-to-collapse-in-demand/

#17 mike from mtl on 07.26.18 at 5:31 pm

Concerning FB, who cares about this ‘plunge’ – this only brings them back to May OF THIS YEAR. Insanity continues.

Personally I wouldn’t care if they go to zero and disappear.

#18 MF on 07.26.18 at 5:33 pm

If anyone cares to check, I predicted the rise in GTA condos a few years back. I based the prediction on sentiment among my mid 20’s to mid 30’s friends. I remember receiving a lot of negativity as a result. How do those doubters feel now?

Anyways,

The reason condos are up is that there are still less head winds than tail winds. Rates aren’t going anywhere and the GTA is absolutely booming. The stress test pushed everyone to the low-mid range and SFH prices are still a hilarious joke, sellers 100% delusional.

The second part of my prediction will ring true as well:

As more of us Millennials enter family formation years, the desire for condos will drop since they are too small in not conducive to family life. This is still a few years off. In addition to this, condo prices will have become so out of control that they are bordering on the same level of SFH. At that point SFH will surge and condos will drop significantly.

My advice to this poster:
#2 Leo Trollstoy on 07.26.18 at 4:16 pm

Sell within the next year. Buyers are becoming harder to come by as prices escalate past the delusional zone (already there and have been there since about 2014) into the joke zone (bordering on it now). You won’t sell though.

MF

#19 MF on 07.26.18 at 5:37 pm

FB stock is a big buying opportunity for anyone with the balls.

We’ve seen this many times. The last one was home capital, the supposed “harbinger” of the GTA RE collapse…which went on to rally like 300% afterwards.

I asked my GF (heavy FB user) what she thought about the FB earnings report and data scandal. She had zero clue what I was talking about and went right back to posting what she ate last night. She couldn’t care less. That’s all you need to know.

MF

#20 The Banks get Richer Every Day on 07.26.18 at 5:43 pm

Don’t look now. Someone has their eye on your equity.

Expect foreclosures and bankruptcies to ramp up as the

housing demand, selling prices and the market goes

down.

#21 Smartalox on 07.26.18 at 5:47 pm

@ LarryB #3:

A lot of so-called ‘move-up buyers’, who sold the starter condos they bought while single have become overcrowded with spouses, kids and pets, are now faced with buying larger condos because:

– Houses (single family dwellings) are currently too expensive to afford once the stress tests are factored in.
– They have large mortgages that they have to port to new properties, or else face paying a hefty fee to pay off ahead of renewal.

So they’re left buying condos, and thinking that they’re on the ‘property ladder’ and not the ‘continuous debt hamster wheel’

#22 Smartalox on 07.26.18 at 5:49 pm

@ MSM-Free Zone #6:

Fake women?

I’d be willing to bet that some parts are fake, at least.

#23 Honey Dripper on 07.26.18 at 5:51 pm

The longer you hold individual stocks the safer they become. I hold lots of stocks where I have collected as much in dividends as what I initially paid for the company. They have in essence become bondified and become safer than bonds.
Of course nothing happens in the short term and you must commit to a holding strategy of forever or at least 10 years. I hold ETfs to capture the US and Int’l markets only. No prefs and no bonds.

#24 Linda on 07.26.18 at 5:52 pm

Does anyone have solid stats on what the actual costs to build in the GTA? As in average price for a serviced lot of land & what the cost of building materials & labor is to build a ‘standard’ housing structure in the GTA region?

Maybe the solution for all those who want to own their own home is to form a consortium & basically become their own developer. Buy/service the land, build the structures. Yes, they would have to do all the work of getting approvals/permits/hiring contractors & trades – not to mention coughing up the development levies to the local municipality (& believe me, that ain’t cheap) but in the end, the actual cost per housing unit could possibly be affordable. Or not. For sure, costing all this out beforehand is key – not much point doing all the work if in the end the cost to purchase is as much or even more than buying from an already established developer/builder.

#25 Smartalox on 07.26.18 at 5:54 pm

Don’t know if FB is a buy. Most people I know who were heavy users have been dropping off FB due to fears about Cambridge Analytica (profiling to drive fear-based messaging for conservative groups), and the company’s generally lacklustre response to the proliferation of hate and bots on the platform.

Now GE, THAT was a smart buy. I was sure to pick some up when they went on sale. The prices may be down, but the dividends sure are sweet!

#26 Mattl on 07.26.18 at 5:56 pm

If I owned a condo I would sell ASAP and try and move up. I would be making serious stink bids on SFH’s looking for that one guy that has to sell. Sure homes will probably fall a bit more, maybe a lot more, but those waiting until absolute bottom will surely miss it and will be trying to buy in when the market turns.

Seems like the perfect storm to move up as long as you can find value on the next place.

#27 Reality is stark on 07.26.18 at 6:00 pm

If you were an intelligent male all that picture should tell you is that the return isn’t worth the risk.

#28 Nonplused on 07.26.18 at 6:02 pm

I think what happens when a market correction occurs in just one stock is that it creates a rally or at least upward pressure in others. The reason is that those folks who do manage to sell their Facebook stocks are now sitting on cash to deploy. Of course no cash is created in the process, so whoever bought Facebook must now be sitting on less cash, but they were probably waiting for a pullback and thus in cash in the first place. Anyway it is a possibility. There are so many players involved it’s impossible to calculate exactly what they all did, you can only look at the tape.

But what we know for sure is that a lot of Facebook equity just went “poof”. It returned to the ether from which it came. This is a natural phenomena in markets that everybody needs to understand, equity isn’t real until you sell. It’s a magic number on a piece of paper or in a computer that you generate by looking at what somebody last paid for your stock or house or whatever, and then multiplying that price by the number of stocks or houses you have. It’s only when everyone decides to sell that we find out how much cash is really out there to support the valuations. Equity depends largely on that not happening.

And then of course there is the affect of margin. Should Facebook have fallen 20% in a day based on reporting what everyone was pretty much expecting anyway? I mean the results were not far off what analysts were expecting. Even the slowdown in users was not unexpected even though it was larger than expected. But what happens to those poor fools who used a lot of margin to get in on the gains is that when the “asset” starts declining their broker will automatically sell the position to maintain the margin amount. Most of the time it is a computer that does it. That, in turn, can create a cascade effect, as other computers react to the declining price and reduce their margin exposure. It doesn’t stop until somebody steps in because they are willing to buy at that price. This is more or less what happened during the flash crash of August 2015. The computers all started selling and the human component of the market was not large enough to keep up with it. Most likely that wouldn’t happen again because the computer programs all have “fuses” now so they stop trading if things get out of hand, but the system is so complex when you consider how many lines of code there are on how many servers all trading against each other I wouldn’t rule it out. The system has likely evolved to the point where nobody truly understands the whole thing.

So, lurking out there somewhere is the possibility of an event where diversification won’t help and a whole lot of equity will go “poof”. It’s happened before in both real estate and the stock markets. It always comes back though, if you can manage to stay in. However if you have a lot of margin when that day comes then it will be a lot like landing on Park Place with a hotel in Monopoly. You’ll be out of the game.

Bonds are a little different though. If they crash they usually don’t come back because the event is usually a reflection of the solvency of the borrower. They can go down in value based on rising interest rates, that is normal, but a crash is usually because something happened to the borrower that caused a significant credit downgrade. And the bond market is much less susceptible to an overall crash because the likelihood that everyone’s credit gets downgraded all at once is small. This is why as you get older you shift your allocation.

#29 Penny Henny on 07.26.18 at 6:05 pm

#11 The Real Mark on 07.26.18 at 4:51 pm
The Toronto condo market has crashed so much that only super-high-end luxury units are moving? Wow. Amazing. And totally predictable, given the gradual slowdown in activity post the 2013 plateau.
////////////////////////

I know that it gets said time and time again but I can’t help but to add and say “Mark you are an idiot”.
STFU

#30 Penny Henny on 07.26.18 at 6:06 pm

Is that Stormy on the left?

#31 Adam Ess on 07.26.18 at 6:14 pm

“Three-quarters of a million for a highrise cube the kids could rent for a fraction of the carrying cost?”

I just read a report today that rent in downtown Toronto now exceeds mortgage carrying costs.

https://www.zoocasa.com/blog/toronto-neighbourhoods-where-its-better-to-buy-a-condo-than-rent-one-infographic/

Doesn’t appear they included property tax and maintenance fees. But regardless, rent is definitely NOT a fraction of owning. The primary driver to rent today is not a significant lower monthly cost, but rather protection from exposure to an overheated condo market.

Fake news. Real costs are not included in the calculation nor is any value ascribed to the equity required to ‘own’ a condo. Renting costs less, ten times out of ten. – Garth

#32 The Real Mark on 07.26.18 at 6:18 pm

“Aren’t these two statements contradictory?”

Not really. Pre-cons go out at market prices on individual identical units. Which are not sales-mix influenced. Whereas the resale units that are actually transacting, the average selling prices are heavily a function of the sales mix. With the data clearly showing that only the very highest end stuff is moving.

So basically the owners of the top end units are realizing that there are better returns to be had elsewhere and are getting out. Buyers appear to be on strike everywhere else due to the higher cost of credit, stagnant prices which makes “moving up” difficult, and the increasing perception of higher opportunity costs.

In reality, GTA/GVR condos have not appreciated since the 2013 plateau in most cases. But a drastically shifted sales mix can certainly cause the “uninformed” to believe that things are in a much different state of affairs than they are really.

#33 Debtslavecreator on 07.26.18 at 6:24 pm

One year today the most probable scenario is recession in Canadstan and a nasty 10-15% drop in most national RE markets especially Vancouver and the outskirts of Toronto
Condos are a great sell

5 years from now most recent buyers will be facing massive monthly fees and large special assessments
Many of these recent condos are so poorly built it’s very sad and outright fraud
10 years from now the majority of these condo owners of the last 4-5 years will see their units down 50-70 % and they’ll be unable to sell and efforts to sue the developers and builders will mostly fail as most will have claimed bankruptcy
You cannot own RE without owning the land – freehold or bust
Worse comes to worse your land always provides tangible value and a floor value and your counter party risk is a lot lower than condos
Condos are wonderful for tenants
This condo market is a once in 30-40 year anomaly
If you own you’d be best thinking about selling by October
Good luck

#34 espressobob on 07.26.18 at 6:30 pm

Gone are the days for individual stock picking. Waste of time. Even my side bets stink.

Global index investors by market cap clean up consistently without all the risk. Fixed income is a windfall for those that rebalance. Funny how so few get that?

Experience is something you can’t pass on. Commodity & sector plays are for the sheep while the product is supplied by fund outfits who know the game. Who wins?

A fee based advisor could save a few asses.

#35 Howard on 07.26.18 at 6:33 pm

Because there are still hundreds of thousands of moisters who want to indenture themselves for an eternity, throwing their entire net worth into a concrete box as a rite of passage into financial illiteracy.

————————————————-

Again, since I’ve posed this question before, where is the evidence that condo buyers in Toronto are predominantly “moisters”? How much do Gen X speculators and Boomers empty nesters factor into this?

#36 crowdedelevatorfartz on 07.26.18 at 6:33 pm

@#17 Mike from Mtl
“Personally I wouldn’t care if they go to zero and disappear.”
+++++++++++

Yep, Facebook.
The “look at me” generation’s selfie “tv channel” full of advertising and gossip……
A time sucking vacuum devoid of any intrinsic value.

I’m amazed its lasted this long…….yawn.

#37 akashic record on 07.26.18 at 6:37 pm

#19 MF
I asked my GF (heavy FB user) what she thought about the FB earnings report and data scandal. She had zero clue what I was talking about and went right back to posting what she ate last night.

Never too late to escape.

#38 The Real Mark on 07.26.18 at 6:40 pm

I still can’t wrap my mind around how right I have been regarding the 2013 real estate plateau. I couldn’t have called it any better. I am just that good.

#39 Linda on 07.26.18 at 6:40 pm

A few internet queries regarding land prices, the average cost per square foot to build a house & development levies in the GTA region yielded the following (all numbers as of 2017 as per the search results).
Cost of land, per acre: 1.4 million
Average cost to build a house, per square foot: $250
Development levies for single or semi-detached: $40,067 per unit
As per the mighty Google, an acre of land provides enough space to build five (5) single family homes. Thus if a group of 5 people bought an acre of land & built 5 homes averaging two thousand square feet per home on that acre the average cost per house would be at least $820,000 per house. The cost to build a house is unlikely to cover the cost of servicing the land – installation of water, sewer, sanitary, electrical, gas; roads, sidewalks, streetlights – in short, all that infrastructure everyone expects to have available for their use when moving in. No, the development levy charges do not mean that the municipality puts this stuff in for you. Those funds are to cover the future cost of maintaining & replacing the infrastructure plus fund for services such as police/fire/EMS stations, libraries, parks & the like.

Given the numbers I found after a brief search, one begins to see why housing costs so much & why multi-unit structures have gained in popularity. The more you can put on that very expensive chunk of land, the lower the per unit cost & for a developer, the greater the profit to be had. When I was looking over the development levy charges I noted that multiple unit structures paid a lower per unit cost, so there is a cost saving to be had there as well.

#40 Howard on 07.26.18 at 6:42 pm

Plunge Protection Team took the day off today?

If the (likely) Enron-calibre fraud that is Tesla isn’t permitted to decline in value, then Facebook is certainly safe. Buy FB stock now, to the moon.

#41 tccontrarian on 07.26.18 at 6:42 pm

“So why are sales offices still jammed? Howcum half the new precons were snapped up in a few weeks?

Because there are still hundreds of thousands of moisters who want to indenture themselves for an eternity, throwing their entire net worth into a concrete box as a rite of passage into financial illiteracy.”
—————–

In other words:

There are the Greater Fools – and then there are the GREATEST of FOOLS!

“…a rite of passage into financial illiteracy.”

Sublime, Garth.

TCC

#42 Howard on 07.26.18 at 6:45 pm

Also re: Facebook. I thought the narrative of low growth has been baked in for years. Haven’t the under-25s been shunning the site? What teen or young adult wants to be part of a social media network where their parents (or grandparents…or GREAT grandparents) add them as “friends” and creep their photos?

#43 bdwy sktrn on 07.26.18 at 6:45 pm

Next time, be smart and drive and F350 with the heaviest 5 ton pintle hitch money can buy permanently mounted out back.

Still remember many moons ago waiting outside a liquor store in my bud’s International Travelall with a wicked hitch on the back. A Camaro whipped in behind and put the hitch right through his own radiator. Oh my …

————————–
the best defense is a strong offense!

doesn’t need to be a f350 though. my hitch on a s10 jimmy has pierced 3 different front bumpers of idiot drivers.
not a scratch on my bumper.

if only the guy who nailed me from behind in my wifes small car met my truck /hitch instead – it would have made it through the rad for sure… oh well.

/////////////////////
btw

1 yr return

dollarama 17% (sorry turnernation)
vfv 20.3%
goog 33.8 %
cost 47.6%

anyone remember me pounding the table for COST exactly one year ago????

my version of bal/div portfolio +cost is about 12%y/y

#44 Asterix1 on 07.26.18 at 6:47 pm

“….who want to indenture themselves for an eternity, throwing their entire net worth into a concrete box as a rite of passage into financial illiteracy”

That is gold! Great stuff….

#45 Gotta Get Out of Calgary on 07.26.18 at 6:47 pm

Timely (and accurate) post given the partial conversation I overheard in the washroom at the restaurant I was at last night:

Late 20-something Female #1: “I’m so sorry your house has become a financial weight for you.”

Late 20-something Female #2: “I’m so stressed about this. I can’t sleep. I’m so stressed, I’ve gained weight. ”

Female #1: “That sucks.”

Female #2: “Yeah, I’m signing up for Weight Watchers next week. Just have to pay the fee but I’m hoping it will help.”

At that point, I departed the room. Struggling to pay housing costs but going to spend a few hundred for a diet program because of the housing stress?

#46 young & foolish on 07.26.18 at 6:55 pm

Sage advice tonight …. any company can take a substantial hit. Having said that though, you still need to accept that slow and steady will be the balanced & diversified route.

That portfolio has more than doubled assets in a decade. Fast enough for most people. – Garth

#47 Zapstrap on 07.26.18 at 7:01 pm

#22 Smartalox on 07.26.18 at 5:49 pm
I’d be willing to bet that some parts are fake, at least.

Like my dentist used to say … who cares?

#48 Danny on 07.26.18 at 7:12 pm

Condominiums have become a place to park money.
This is what my banker told me. Interest from banks savings….way too low…..and condos are the single lowest purchase.
Yes I agree compared to investing in the market….this condo buying is at odds.
The question is will supply be high enough to change the trend in the next year or two.
One trend I have noticed this week…in one condominium…is….4 units recently upgraded…to the $700,000 to $800,000 level….usually un-renovated ($550,000 to $600,000) did not sell for approximately 3 month.
Now they are for rent…They must feel….this is a good place to park money. Rent for these ranges from $2,500 to $2,800 …in area where it is elsewhere from $2,000 to $2,200.

Did you hear that “machine gun talking Donald…with his lawyer Cohen “…..What an over drugged
“Coca Cola addict ” sounds like. And he is running America!

#49 jas on 07.26.18 at 7:19 pm

I am only going to comment on the picture of today’s blog post:
If this old fart wants to have any fuel, he better get either some Chinese traditional medicine or get it from ancient school of Ayurveda in India.
I would love to see this man die of exhaustion.

#50 AK on 07.26.18 at 7:22 pm

“At the same time, the average new detached house is almost 10% cheaper (at $1.13 million).”
=====================================
35% cheaper in Markham…

#51 AK on 07.26.18 at 7:25 pm

“And while just 421 singles sold last month, there is an unsold inventory of 4,848 units.”
——————————————————————
They are waiting for February 2017 prices to return.

#52 jas on 07.26.18 at 7:26 pm

#46 young & foolish
That portfolio has more than doubled assets in a decade. Fast enough for most people. – Garth
————————————————————-

If it doesn’t double in 7 years, its a poor investment.

#53 Long-Time Lurker on 07.26.18 at 7:27 pm

Zuck got out, at least in part:

https://www.zerohedge.com/news/2018-07-26/sec-may-want-take-look-facebook-insiders-dumped-41-billion-stock-scandal

#54 For those about to flop... on 07.26.18 at 7:55 pm

Pink Lemonade Stand in West Vancouver.

These guys just ripped up 200k in paper equity and are in the process of finding out how slow the detached market is over 3 million dollars.

Picked up for 3.16 in June 2016,probably hoping to find a victim to rob that isn’t paying attention and now it’s themselves that are being held up.

Any offer starting with a three take it.

The detached market is going down like Bonnie and Clyde…

M44BC

1027 Clyde Avenue, West Vancouver.paid 3.16 June 2016 ,assessment 3.26

Jun 26:$3,488,000
Jul 25: $3,288,000
Change: – 200000.00-6%

https://www.zolo.ca/west-vancouver-real-estate/1027-clyde-avenue

$$$$$$$$$$$$$$$$$$$$$$$$$$$$

Feel free to make a donation.

Flop For Fox Fund…

http://www.terryfox.org/get-involved/ways-to-give/

#55 pay your taxes on 07.26.18 at 8:02 pm

#2 Leo trollstoy

The average new condo in the GTA now costs $774,554. Seriously. That’s 23.5% higher than a year ago. At the same time, the average new detached house is almost 10% cheaper (at $1.13 million).

Bingo!

SFH prices peaked in the spring of 2017

Condo prices still going up!

_xxxxxxxxxxxxxxxxxx

Nay my brother. You’re forgetting the sales mix, deflation and the $1.50 Loonie. We all know that prices peaked in 2013!

#56 The Real Mark on 07.26.18 at 8:04 pm

“#38 The Real Mark on 07.26.18 at 6:40 pm ”

*sigh*, personation isn’t cool. Its downright childish. Garth and his admin can easily verify such through my unique email, or even VPN IP address.

#57 Dogs being Dumped??? on 07.26.18 at 8:08 pm

“lets celebrate what joins us on this site…Canines”

Addiction to this blog may fade (although I acknowledge there may be different opinions about this) …yesterday pic of repulsive fat guy ….today -tabloid material or worse. Am I reading CNN or Daily Mail?
Review of pics for last 7 days : 2/7(measly 29% return- using financial terms) were dogs (incl one by Ryan who admitted trying to enhance his image) ..and 7 of last 14 (50%), .. incl 2 from Ryan.
On the theme”in praise of many” ….may I humbly add a few dog data that may illustrate this theme….there are 340 breeds of dogs recognized by the World Canine Organization …and 167 recognized by the American Kennel Club….
A composite pic of a Great Dane, chihuahua, poodle and maybe a dachshund or ? would probably hold my interest for longer than the average 3 min readers spend on this blog.
I would like to keep learning from the dogs.
I do not waste time on tabloids.

#58 crowdedelevatorfartz on 07.26.18 at 8:17 pm

@#38 The Real birthMark
“I am just that good.”
+++++

Yes you are.
However, you might want to work on your humility if Penny Henny has anything to say about it……

:)

#59 Mattl on 07.26.18 at 8:18 pm

#39 Linda – bingo. Which is why I get a kick out of the folks calling for 50-70% declines. Even if land was free it would cost 400k to build a small, by todays standards , new home almost anywhere. A lot of the cost of homes is tied to inflation, labour, machine work, supplies are incredibly expensive. We are not going back to new 200k homes anywhere, that ship sailed. There is a new bottom for homes in major markets and it is much higher then the doomers realize.

Obviously when the housing market pops lot prices will go down but I short of a job crushing recession and serious deflation I don’t see how new homes get built for under 200 a sqft net to buyer.

#60 crowdedelevatorfartz on 07.26.18 at 8:21 pm

DELETED

#61 leebow on 07.26.18 at 8:34 pm

That guy… They should arrange a place for him in the Bureau of Weight and Measures. Absolute pure unit of kitsch.

#62 TRUMP on 07.26.18 at 8:35 pm

PIMP !!!!!!

#63 Headhunter on 07.26.18 at 8:45 pm

#59 Mattl on 07.26.18 at 8:18 pm
#39 Linda – bingo. Which is why I get a kick out of the folks calling for 50-70% declines.

________________________________________

USA, Spain, Greece, Ireland, venezuela, Japan, do I need to go on.. all took big haircuts and real estate. Do you think you masters are going to let you get away without paying ur dues. 50% easy. Sooner then you think.

Its just shelter go out an enjoy, take the vaca, buy the vette, put jimmy in private school..by the time most realise that statement its too late.

Talking bout F350`s IH.. Had a 350 dually pull a house down so much power. Didn`t like the cold..I do a lot of sledding so had to bail on er.. went 4th gen 5.9 Dodge Ram Dually.. worth every cent

#64 Leichendiener on 07.26.18 at 8:46 pm

Classic Trump troll picture. Yes, concentrate and stay balanced.

#65 TurnerNation on 07.26.18 at 8:47 pm

Don’t worry SJWs, Trump always gets oral consent.

#66 conan on 07.26.18 at 9:02 pm

Quite the drop zone on the FB chart
I think this might lead to some contagion if it does not bounce back nicely.

Next few days are key. A flare up on the middle east could adversely effect markets.

#67 The Real Mark on 07.26.18 at 9:06 pm

I thoroughly enjoy being a total maroon posting nonsense about how an ongoing property bubble peaked 5 years ago, on a blog documenting the bubble.

I am the Real Mark. Real dumb.

#68 BS on 07.26.18 at 9:21 pm

The big lesson this week with the meltdown of FB. The world’s top social media platform was savaged by the markets Wednesday night and again Thursday – down 18% at the opening a day after reporting results.

Meltdown. LOL, it gave up less than 3 months worth of gains. Back to May 2018 levels. You pay too much attention to fake news.

Losing 18% is not fake in my world. – Garth

#69 young & foolish on 07.26.18 at 9:23 pm

Thanks nonplused #28 …. Good post

#70 Viorelli on 07.26.18 at 9:43 pm

A friend just returned from southern Montana where he talked to few people in a smaller town. We are ready to repeal the flood of climate refugees with lots of weapons and live ammo. The sheriff is on our side and we even have an operational tank and some heavy duty toys at our disposal. When the feminazi and the rest of the liberal scum arrives from waterless California we will be ready. The farmers are ready to fight. It a wild west all over again in the good, old USA. This is what globalization and climate change are doing. Just the beginning. 2

#71 Leo Trollstoy on 07.26.18 at 9:47 pm

PH condo above me sold last month for $1000/sqft

Reached out to selling agent

She offered to sell mine. I was non-commital. Bring me similar comp and I’ll look at signing docs. Otherwise imma sit. Her call

#72 Dolce Vita on 07.26.18 at 10:01 pm

God almighty Garth, you sure do know how to get the formerly in hiding RE Pumpers out in force today.

I love the theories about age and families, current land values thus condos a bargain, on and on from people that ate the book covers in Economics, that are ignorant of history yet congratulate themselves on coin flip probability predictions.

Those self-congratulatory arguments were made decades ago and before the bottom fell out in the early 80’s, 90’s and somewhat in 2007.

RE crashes happen, come with little or no warning and that’s that. As usual and discovered later, an external economic shock to blame.

If Trump duties the Canadian auto industry and our Trust Fund Boi PM fails to salvage that, well, a major RE crash esp. in auto job rich ON will happen as the job losses pile up followed by doom and gloom psychology.

The bigger the RE bubble historically, the larger the crash. RE history repeats with each recession causing economic shock.

Each generation thinks it is more clever than that which came before it.

They chime the same tired decades old arguments thinking theirs are unique, revelatory and that this time it will be different (hubris, arrogance, ignorance).

No it will not be different this time. Enjoy the calm before the storm, now just a few months away…sooner if Trump has his way with Canada.

#73 Leo Trollstoy on 07.26.18 at 10:06 pm

I wonder when Toronto condo prices will plateau

We won’t know until after it happens

Like SFH in spring 2017

My friend bought a 2600 sqft townhouse in distillery district. Only $1.7m. Good price!

#74 Leo Trollstoy on 07.26.18 at 10:29 pm

#67 The Real Mark on 07.26.18 at 9:06 pm

It’s ok chrissy I accept your apology

It’s hard being wrong on everything from the $C/$US, deflation, gold, RE, tech boom, etc

Friendly word of advice: just get your evidence from reputable sources like gartho instead of making stuff up

Don’t reply if you agree

#MAGA

#75 Blacksheep on 07.26.18 at 10:32 pm

“Picked up for 3.16 in June 2016,probably hoping to find a victim to rob that isn’t paying attentiion”
————————
I would be curious to know what motivates a party to buy a home and then turn around and sell in only a couple of years or less, especially at at a loss?

Why not hold on and let inflation do it’s thing, I mean is everyone selling a home in Van, a flipper?

Maybe job transfer, divorce, job loss, personal bankruptcy, major illness, or even the death of spouse?

Right, I forgot, every seller’s a crook and every buyer a victim.

#76 The Real Mark on 07.26.18 at 10:43 pm

“Friendly word of advice: just get your evidence from reputable sources like gartho instead of making stuff up”

Pretty rich words coming from a guy who makes most of his ‘content’ up. And deliberately does not understand the sales mix.

Seriously, who do you work for Troll? What is your interest in badgering me? Are you just a Realtor who’s suffering a lack of business due to the downturn, trying to mislead everyone? Sure sounds like it. Nobody is fooled by you.

#77 For those about to flop... on 07.26.18 at 10:45 pm

Race to a million.

As we inch closer to livable detached houses going for under one million again,these guys could be candidates to be among the first settlers.

5005 Manor st

Asking 998k

Assessment 1.19

Their neighbours at 5002 Manor st, sold recently and was asking roughly the same and from what I can tell this house is in much better condition.

It’s just a matter of time ,I don’t know when but the market forces are too strong even for the bottom end not to dip below this marker.

Grab a cuppa,the kettle is about to boil…

M44BC

https://www.zolo.ca/vancouver-real-estate/5005-manor-street

Recently sold.

https://www.zolo.ca/vancouver-real-estate/5002-manor-street

$$$$$$$$$$$$$$$$$$$$$$$$$$$$

Feel free to make a donation.

Flop For Fox Fund…

http://www.terryfox.org/get-involved/ways-to-give

#78 Oft deleted much maligned stock picker on 07.26.18 at 11:03 pm

DELETED

#79 For those about to flop... on 07.26.18 at 11:05 pm

pm
“Picked up for 3.16 in June 2016,probably hoping to find a victim to rob that isn’t paying attentiion”
————————
I would be curious to know what motivates a party to buy a home and then turn around and sell in only a couple of years or less, especially at at a loss?

Why not hold on and let inflation do it’s thing, I mean is everyone selling a home in Van, a flipper?

Maybe job transfer, divorce, job loss, personal bankruptcy, major illness, or even the death of spouse?

Right, I forgot, every seller’s a crook and every buyer a victim.

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

I told you never to write me again or I will not post on here anymore.

It was a Bonnie and Clyde themed post.

The house was on Clyde Avenue.

You win.

Take care, guys…

M44BC

#80 cramar on 07.26.18 at 11:12 pm

Canadian Millennials Have a New Reason to Resent Baby Boomers

https://www.bloomberg.com/news/articles/2018-07-26/prices-of-waterfront-cottages-surge-as-canadian-retirees-cash-in

#81 Can You Dig It? on 07.26.18 at 11:32 pm

Buy WWE stock!

Now can you dig that, suckaaaaa?!

#82 MF on 07.26.18 at 11:36 pm

70 Viorelli on 07.26.18 at 9:43

A false prediction.

War has shown you can take a nonviolent person, train them, give them a weapon, and they can be good soldiers.

What you are describing is some catastrophic US civil war 2.0 vision. In the actual civil war southern farmers were armed and ready to fight too. They were great soldiers and dedicated but ultimately were overrun by the sheer industrial strength and manpower of the north.

The same would likely be repeated. The concentration of money and manpower in the blue states would likely win.

It would be at a huge cost of human life, the end of the US, and would thrust the world into war and disarray so let’s hope it never happens.

MF

#83 Ron on 07.26.18 at 11:51 pm

#59 Mattl on 07.26.18 at 8:18 pm
#39 Linda – bingo. Which is why I get a kick out of the folks calling for 50-70% declines. Even if land was free it would cost 400k to build a small, by todays standards , new home almost anywhere.

————————————–

That will change. Technology will deflate construction costs in the near future just like everything else.

https://www.quantumrun.com/prediction/housing-prices-crash-3d-printing-and-maglevs-revolutionize-construction-future-cities-p3

#84 Where's The Money Greedo? on 07.27.18 at 12:15 am

Just got a note from my soon to be ex-credit union Coast Capital. It’s full speed ahead for them to become a federal credit union. Should be finalized this fall, just in time to get bailed-in.
Funny how that works. I guess having hired an ex-OSFI director and ex-Director of Legal Compliance of BC Hydro got this fast tracked. The ex-Hydro Director was Greedo Scambell’s appointee in there to sell out the taxpayers to Greedo’s buddies; one IPP even has a former BC Solicitor General under Greedo as Director to give him steady work with those 50 year contracts to pay multiples of the going rate for power.
I guess Coast’s next step is get themselves on the stock market, issue shares and give themselves Class A shares while the members get lowly Class C shares, then sell the “bank” and walk away with millions in their pockets, leaving members with peanuts.
Just like what happened in Australia 10-15 years ago, a scandal that has now been white-washed off the internet. I can’t find anything on it anymore.
The ex-BC Hydro Director Of Compliance is Australian though he wasn’t in on the scam is Aussie land.
I wrote about this some years ago on this site but don’t know how to access the info. Maybe Garth can enlighten us with this info.
It was very sleazy what they did to those CU members.

#85 Where's The Money Greedo? on 07.27.18 at 12:18 am

Re; #75 Blacksheep on 07.26.18 at 10:32 pm
“Picked up for 3.16 in June 2016,probably hoping to find a victim to rob that isn’t paying attentiion”
————————
I would be curious to know what motivates a party to buy a home and then turn around and sell in only a couple of years or less, especially at at a loss?
+++++++++++++++++++++++++++++++++
It’s called trying to get rid of the money launder evidence with the new investigation that the BC gov’t is now implementing.
Gotta get out before the federalis come in and take it under proceeds of crime.
There’s going to be lots of fire sales soon.

#86 Where's The Money Greedo? on 07.27.18 at 12:27 am

Addendum to my reply to: #75 Blacksheep on 07.26.18 at 10:32 pm
“Picked up for 3.16 in June 2016,probably hoping to find a victim to rob that isn’t paying attentiion”
————————
I would be curious to know what motivates a party to buy a home and then turn around and sell in only a couple of years or less, especially at at a loss?
+++++++++++++++++++++
Forgot to add that they want to sell anyway they can because when the federalis-BC gov’t come they will confiscate the home they sold to the suckers, who thought they got a “steal”- a real deal.

#87 I hope this is happening in Vandeadcity on 07.27.18 at 1:43 am

2018 is the first time in 10 years that Chinese companies have sold more real estate assets in a single quarter (US$1.29 billion) than they have purchased (US$126.2 million).

https://www.taiwannews.com.tw/en/news/3491015

#88 april on 07.27.18 at 1:56 am

#77 Flop, hope that applies to condos as well and at the bottom end too.[Lower Mainland BC] Many of us cannot afford anything over 300 thousand unless we move to the boonies.

#89 Where's The Money Greedo? on 07.27.18 at 2:08 am

This is a must read for anyone who is interested in keeping gov’t to account. It is written by one of BC’s great bloggers Norm Farrell, who has written many great pieces informing BC residents of the corruption by the BC Liberals from their 1st day in office in 2001.
He has many accounts of the obvious kleptocracy that the BC Liberals were over 16 years of ruling BC.
https://in-sights.ca/
https://in-sights.ca/2018/07/09/too-timid-to-act/
Please read many of his pieces as it gives an accurate picture of how BC has been stolen from its citizens by the Campbell/Clark/Coleman mafioso enterprise (taken form Norm’s piece, but I put the mafioso in).
We need a Charbonneau Corruption type inquiry in BC tout suite! These scum must be brought to justice…..

#90 jane24 on 07.27.18 at 3:50 am

Tech stocks NEVER last forever. They go from new and exciting for high tech types to flavour of the month for their parents to old hat in a much faster life cycle then a stock that actually produces something. Facebook replaced myspace.com. Does anyone remember myspace.com?

I use facebook maybe once a week to spy on my kids and friends and have noticed that about half of my original list of friends no longer post. They still have active accounts but don’t use them much now. I am put off by the number of ads on mine. They make finding friend content now a bit of a challenge so I don’t bother so much to try.

I am also very wary of data control. My niece had a conversation on her Canadian mobile with a friend and discussed certain matters. Within 24 hours ads for items related to that supposedly private phone call showed up on her facebook page. Makes you think. Only the very naive would think that facebook is free.

#91 Tony on 07.27.18 at 4:26 am

Re: #2 Leo Trollstoy on 07.26.18 at 4:16 pm

The yuan is still falling. Remember P.T. Barnum’s line about a fool and his money?

#92 Stan Brooks on 07.27.18 at 4:27 am

The average new condo in the GTA now costs $774,554. Seriously. That’s 23.5% higher than a year ago. At the same time, the average new detached house is almost 10% cheaper (at $1.13 million).

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

It is clear that these prices are not justifiable or sustainable.

Don’t tell me that such prices are normal. It is clear that the credit orgy and totally irresponsible lending continues.

If this was a normal place with no CMHC and taxpayer backing for really bad, bad loans, some banks would have been in serious, serious troubles with their 0 (ZERO) deposit reserves.

It is clear that the loonie is doomed, but quite amusing to see it actually rising lately, absolutely unjustifiable.

No doubt we will see sudden and intense crash of some sort as pressure builds in this ponzi scheme of biblical proportions.

Annual inflation of 15 % + with no interest rate increase could be the norm in the next decade.

#93 Tony on 07.27.18 at 4:34 am

Re: #73 Leo Trollstoy on 07.26.18 at 10:06 pm

From what I’ve seen on mls they peaked in March 2018.

#94 IHCTD9 on 07.27.18 at 7:38 am

The average new condo in the GTA now costs $774,554.
________

That’s really incomprehensible. I look around Ontario at the smaller cities with 100X less people than the GTA, and lots of times I see higher household incomes, and way lower housing prices.

Maybe big city moisters suffer from “target fixation”? They don’t know/care what wages/RE costs are outside their area?

These condo buyers will be the next wave of regretful spring of 2017 SFD buyers who stuck it to themselves good and hard. I suppose we’ll see folks walking away from condo deals within 12 months. This summer is probably the last chance to unload near the “peak”.

I work in a smallish city of about 50K population. Median household incomes here are slightly higher than in Toronto (per 2015). BUT, out here; 800 grand gets you a SFD so nice, you’ll never see any of your friends again.

The moisters have lost their peripheral vision, reason, and caution. Anyone buying a skybox for 800K is going to experience a life changing financial mushroom cloud if they try to stay in it for the long term.

#95 crowdedelevatorfartz on 07.27.18 at 8:13 am

@#89 Where’s the money Greedo
Re : Former Liberal Premier Gordon Campbell

Well, I guess his “life on the lam” in London England as a trade Commissioner was long enough.
He’ll now be back in Canada working with Doug Ford in Ontario.
I can only imagine what their paying him for his “advice”.

#96 jess on 07.27.18 at 8:13 am

A British Columbia provincial employment department has since ordered Istuary to pay around $2.2 million in unpaid wages to more than 150 employees and has begun collection proceedings in order to seize Sun’s residential properties, a spokesperson from the province’s labour ministry said in an email.

The fallout, and Sun’s broken promises, soon reached the company’s operations in China. According to Laura Fan, an Istuary employee in Guangdong province, Sun claimed the company’s cash crunch was because of poor management and Chinese regulatory changes. He also blamed Chinese investors and their “political mission” for pressuring him into striking deals with U.S. chip companies, she said.

In December, Istuary and Kuang’en’s offices began closing across China, without employees being paid for months of work. “These people never got any of their salaries,” Fan said.

https://www.therecord.com/news-story/8760178-a-tech-guru-captivated-canada-then-he-fled-to-china-/

#97 Wrk.dover on 07.27.18 at 8:13 am

#94 IHCTD9 My freezer issue is indeed the thermostat sourced from you know where, made by you know who. I will replace it with the thermostat from the 38 year old freezer I use unplugged to store gas jugs at a stable temperature, for the back up generator for the freezer food inventory. My wife harvests and hoes thirty minutes every morning at around six these days. We go to the grocery store about monthly, year around to buy mostly stuff that does not get ingested.

#98 Wrk.dover on 07.27.18 at 8:17 am

At 3/4 million $, I have no FOMO! None.

#99 IHCTD9 on 07.27.18 at 9:19 am

#97 Wrk.dover on 07.27.18 at 8:13 am
#94 IHCTD9 My freezer issue is indeed the thermostat sourced from you know where, made by you know who. I will replace it with the thermostat from the 38 year old freezer.
_____

Glad you got it figured out. I actually had a guy in twice to deal with our freezer problem – both times the problem persisted after he left. I didn’t bother calling back again after the second time and fixed it myself thanks to the partselect.ca site info.

The internet still amazes me with how great it is even after all these years. It’s a DIY heaven :).

#100 Shawn Allen on 07.27.18 at 9:43 am

Is The U.S. a loser Country?

Only weak loser uncompetitive countries with weak leadership would turn to tariffs. |Strong countries and strong companies with good workers need no tariff protection and are prepared to compete globally.

#TariffsAreForLosers spread the word

#101 crowdedelevatorfartz on 07.27.18 at 9:56 am

@#99 IHCTD9

Yeah, I had a “plumber” in one year to winterize my cottage.
I cam in the Spring, Turned on the power and found 9 burst pipes and a ruined Hotwater tank.
If that “plumber” had of showed up at any time in the next 3 days of repairs and cold showers… He would have gone missing and the septic field would have had a new patch of sod.
Lesson learned. I cut open drywall, repaired the breaks, put in low point drains under every sink, High point air valves to allow gravity to empty the pipes, new hot water tank, and a new UV light , 5-10 micro filtration system.
All the stuff I was going to hire someone to do.
That “plumber” screwed himself out of a lot more billable hours by being a lazy sack of …….

#102 Smoking Man on 07.27.18 at 10:00 am

USA 4.1% GDP

Whoa!!! Trump is a rock star…

Growth was greater under Obama in 2014 (5%). Don’t get too excited. – Garth

#103 The Wealthy Mark on 07.27.18 at 10:03 am

Bragbook is so yesterday. I am in way over my head. I am a scared boy. Help!
MZ

#104 Leo Trollstoy on 07.27.18 at 10:13 am

#76 The Real Fake News on 07.26.18 at 10:43 pm

Thank you for agreeing with gartho and I that RE prices for SFD peaked in spring 2017

Don’t respond if you’re wrong and have no evidence

#MAGA

#105 Blacksheep on 07.27.18 at 10:43 am

Where’s # 85,

Re; #75 Blacksheep on 07.26.18 at 10:32 pm

“Picked up for 3.16 in June 2016,probably hoping to find a victim to rob that isn’t paying attentiion”
————————
I would be curious to know what motivates a party to buy a home and then turn around and sell in only a couple of years or less, especially at at a loss?
+++++++++++++++++++++++++++++++++
“It’s called trying to get rid of the money launder evidence with the new investigation that the BC gov’t is now implementing.
Gotta get out before the federalis come in and take it under proceeds of crime.
There’s going to be lots of fire sales soon.”
—————————–
Where’s # 86,

“Addendum to my reply to: #75 Blacksheep on 07.26.18 at 10:32 pm”

“Picked up for 3.16 in June 2016,probably hoping to find a victim to rob that isn’t paying attentiion”
————————
“I would be curious to know what motivates a party to buy a home and then turn around and sell in only a couple of years or less, especially at at a loss?”
+++++++++++++++++++++
“Forgot to add that they want to sell anyway they can because when the federalis-BC gov’t come they will confiscate the home they sold to the suckers, who thought they got a “steal”- a real deal.”
—————————-
Yes of course, thanks for the confirmation.

Like I said:

“Every seller’s a crook and every buyer a victim.”

#106 young & foolish on 07.27.18 at 10:43 am

relentless real estate Doom & Gloom on this blog …

yeah, ok, sure … waiting for those 50-70% declines

#107 young & foolish on 07.27.18 at 10:49 am

“The longer you hold individual stocks the safer they become. I hold lots of stocks where I have collected as much in dividends as what I initially paid for the company. They have in essence become bondified and become safer than bonds.
Of course nothing happens in the short term and you must commit to a holding strategy of forever or at least 10 years. … ”

Probably blue chips with “wide moats” …. as Warren says, never buy a stock you are not willing to hold for at least 10 years. But does today’s instant gratification crowd have the patience for that?

#108 James on 07.27.18 at 10:50 am

#102 Smoking Man on 07.27.18 at 10:00 am

USA 4.1% GDP
Whoa!!! Trump is a rock star…

Growth was greater under Obama in 2014 (5%). Don’t get too excited. – Garth
_____________________________________________
Yes but Garth it’s all FAKE NEWS according to the man behind the curtains.
“Doublethink means the power of holding two contradictory beliefs in one’s mind simultaneously, and accepting both of them.” George Orwell

#109 Mattl on 07.27.18 at 10:50 am

#59 Mattl on 07.26.18 at 8:18 pm
#39 Linda – bingo. Which is why I get a kick out of the folks calling for 50-70% declines.

________________________________________

“USA, Spain, Greece, Ireland, venezuela, Japan, do I need to go on.. all took big haircuts and real estate. Do you think you masters are going to let you get away without paying ur dues. 50% easy. Sooner then you think.”

The US is the best comparable. Some places like Vegas and areas of Phoenix got destroyed, but even if those wastelands – you ever see Queen Creek? – the decline was around 50%. Other places with stronger economic bases like Boston, Seattle and MANY other cities too hits between 15-30%. The US as a whole was down somewhere around 30%.

Like I said, in major markets there is resistance at the bottom end. A new house in Port Moody, even with lot prices severely down from say 500K to 250K, is still going to cost 650K-800K to stand up. These homes sell today for 1.2MM. It is fantasy to think that these homes are going to sell for under replacement.

Like Boston, Seattle, San Fran and NYC there is just too much demand for homes in YVR or GTA for a 50% melt without there being a major recession, or catastrophic economic even. If something wild happens, all bets off, and if that did happen, guess who would be scooping up cheap Vancouver houses for the inevitable next run up? Big money.

There is literally no scenario where homes in desirable areas of Canada drop 50-70% without the whole CDN economy burning. This is the vulcher fantasy and the irony is if we ever did get 50 down, these same vulchers would be waiting on 10% more and miss the 30% run up.

#110 Oft deleted much maligned stock.picker on 07.27.18 at 10:54 am

DELETED

#111 Danforth on 07.27.18 at 11:07 am

Please don’t post pictures of Trump, unless its associated with some strong rebuke of him.

This photo celebrates trump, and normalizes all the pussy-grabbing nastiness one is reminded of when you think of “Trump and Women”.

To illustrate “diversification” in investments, you show Trump with a bunch of women? It’s quite gross, actually.

Garth, you’re better than this.

#112 Wrk.dover on 07.27.18 at 11:53 am

#109 Mattl on 07.27.18 at 10:50 am
you ever see Queen Creek?

———————————————–

Queen Creek sounds like an oasis, but is a hell hole dust bowl with the grubbiest main drag in the Valley Of The Sun, as well as the mother of all prisons. It makes Milton seem splendid, and the all encompassing 202 loop swerves away from it, keeping it removed from all the conveniences of the rest of Maricopa County. It should have dropped the most in value ’08. So it did.

#113 The Real Mark on 07.27.18 at 12:32 pm

Thank you for agreeing with gartho and I that RE prices for SFD peaked in spring 2017

SFD peaked in 2013 and no lies told on this blog will stop me from sharing the truth.

The sales mix changed for the past 5 years. Your trolling does not make it different. It makes me one angry boy.

#114 James on 07.27.18 at 12:39 pm

Sitting now for two days of a massive gutting on my FB stock. Biggest loss I have ever endured. Should I stay or should I go, either way I bought in in February of 2015 so all is still good. As the O-Sensei (Great Teacher) taught us to be patient and If you are centered, you can move freely. Morihei Ueshiba
As per Garth s teaching I have diversified but still have an affinity to hold on stocks over time. Its a weakness.

#115 Ubul on 07.27.18 at 1:16 pm

#102 Smoking Man on 07.27.18 at 10:00 am

USA 4.1% GDP

Whoa!!! Trump is a rock star…

Growth was greater under Obama in 2014 (5%). Don’t get too excited. – Garth

Q: Was full-steam EQ, historically unprecedented interest rate in place in 2014?

#116 n1tro on 07.27.18 at 1:21 pm

Remember when some of us mused about self identifying as female for the perks? So far, $1100 in savings!

https://www.msn.com/en-ca/news/canada/transgender-community-upset-by-drivers-licence-stunt/ar-BBL85KG?ocid=spartandhp

#117 Mattl on 07.27.18 at 1:21 pm

Wrk.dover exactly. And anyone expecting a Queen Creek style crash in YVR or Toronto is nuts. I could see places like Maple Ridge – far out from the city, cheap box builds – get really pounded. Lot prices in those places went from 125k to 400k in 5 years. Lots of new homes in these far out areas bought by folks that just had to have a home and spent 800k for a crap box on a 3000 sqft lot. Would not be surprised to see those places get into the 5’s.

#118 jess on 07.27.18 at 1:25 pm

blog dogs unite

A Colombian gang has put a $70,000 bounty on Sombra the drug-sniffing dog

By Gianluca Mezzofiore, CNN

Updated 11:29 AM ET, Fri July 27, 2018

Her talent for sniffing out drugs has led to the capture of at least 245 people and the seizure of 9 tons of cocaine from the powerful Urabeños gang in Colombia.
But now Sombra (Shadow, in English), a 6-year-old German shepherd who is incredibly popular among children and adults alike, is in danger.

#119 Ubul on 07.27.18 at 1:26 pm

#114 James
No worries about FB, only 3% today. It’s a healthy price discovery. Like TWTR, LOGM. How much of those do you hold?

#120 DON on 07.27.18 at 1:29 pm

#83 Ron on 07.26.18 at 11:51 pm

#59 Mattl on 07.26.18 at 8:18 pm
#39 Linda – bingo. Which is why I get a kick out of the folks calling for 50-70% declines. Even if land was free it would cost 400k to build a small, by todays standards , new home almost anywhere.

————————————–

That will change. Technology will deflate construction costs in the near future just like everything else.

https://www.quantumrun.com/prediction/housing-prices-crash-3d-printing-and-maglevs-revolutionize-construction-future-cities-p3
*************
Good Point Ron.

Linda. Building materials (lumber) have not gone up that much and the ones that did – went up due to demand (granite countertops). Square foot costs went up due to demand and developers started upping the price. When demand slows…why woudn’t the costs of building a square foot decrease. Am I missing something? Isn’t this all about supply and demand.

#121 DON on 07.27.18 at 1:42 pm

#99 IHCTD9 on 07.27.18 at 9:19 am

#97 Wrk.dover on 07.27.18 at 8:13 am
#94 IHCTD9 My freezer issue is indeed the thermostat sourced from you know where, made by you know who. I will replace it with the thermostat from the 38 year old freezer.
_____

Glad you got it figured out. I actually had a guy in twice to deal with our freezer problem – both times the problem persisted after he left. I didn’t bother calling back again after the second time and fixed it myself thanks to the partselect.ca site info.

The internet still amazes me with how great it is even after all these years. It’s a DIY heaven :).
************

I enjoy your posts – love the DIY info the internet and from you – in terms of fixing cars, appliances etc. I come to this site for well vetted financial/investing and common sense. What a great site you have Garth.

#122 DON on 07.27.18 at 1:45 pm

#101 crowdedelevatorfartz on 07.27.18 at 9:56 am

@#99 IHCTD9

Yeah, I had a “plumber” in one year to winterize my cottage.
I cam in the Spring, Turned on the power and found 9 burst pipes and a ruined Hotwater tank.
If that “plumber” had of showed up at any time in the next 3 days of repairs and cold showers… He would have gone missing and the septic field would have had a new patch of sod.
Lesson learned. I cut open drywall, repaired the breaks, put in low point drains under every sink, High point air valves to allow gravity to empty the pipes, new hot water tank, and a new UV light , 5-10 micro filtration system.
All the stuff I was going to hire someone to do.
That “plumber” screwed himself out of a lot more billable hours by being a lazy sack of …….
******
LOL

#123 DON on 07.27.18 at 1:58 pm

#105 Blacksheep on 07.27.18 at 10:43 am

Yes of course, thanks for the confirmation.

Like I said:

“Every seller’s a crook and every buyer a victim.”
************

Nope…but “every hand’s a winner and every hand’s a loser And the best that you can hope for is to die in your sleep” Kenny Rogers.

Blacksheep you resorted to extremes in your argument, not every seller is a crook or buyer a victim. Some are and some aren’t. Then again you have consistently said the housing market is Van would never go down. I take it you are old enough to remember the 80’s and 90’s real estate debacle. How about the US, Spain, Ireland housing fiascos etc? I am beginning to believe you don’t even read Garth’s blog posts. oh well…be well!

Flopper…Keep on posting – I love the analysis you provide. Thanks for the play by play – I appreciate your time and effort.

#124 DON on 07.27.18 at 2:03 pm

#106 young & foolish on 07.27.18 at 10:43 am

relentless real estate Doom & Gloom on this blog …

yeah, ok, sure … waiting for those 50-70% declines
***************

Well patience must be practiced. Look at the present trajectory. What is the argument for continued price appreciations. Remember the “Big Short” movie…no one but a few knew what was going on until it bubbled to the top and slowly people became aware and all hell broke out. Just because you personally aren’t paying attention or aware – does not mean it did not or is not happening right under your feet.

cheers,

#125 DON on 07.27.18 at 2:11 pm

@Dolce Vita

In your posts you cover it all – commonsense based on fact and experience. We are like minded for sure at least on the subjects we post on here. Maybe our family trees are related. Always a pleasure reading your posts. Please keep them coming.

#126 jess on 07.27.18 at 2:15 pm

#111 Danforth on 07.27.18 at 11:07 am

american sells itself as the “free” society rather than the “fear society” and a society of values and seem to always be bragging about being the most wealthiest country in the world

=====================================
The U.S. has the highest maternal death rate in the developed world and it has been steadily increasing in recent years…

The two leading causes of childbirth deaths and injuries are hemorrhage and severe hypertension, the investigation found. These conditions require health care providers to pay close attention to a patient’s blood pressure and blood loss levels.

However, USA Today’s report found that many hospitals are often “eye-balling” how much blood a woman loses during childbirth instead of measuring it for warning signs.

https://www.cbsnews.com/news/best-and-worst-states-to-give-birth-usa-today-investigation/

#127 Leo Trollstoy on 07.27.18 at 2:24 pm

#113 The Real Fake News on 07.27.18 at 12:32 pm

crissy I’m just happy that u can’t link any evidence

respond if u agree

u welcome lol

#128 NoName on 07.27.18 at 2:24 pm

just to put it out there

https://www.forbes.com/forbes/welcome/?toURL=https://www.forbes.com/sites/simonconstable/2018/07/24/trumps-economy-still-lags-that-of-clinton-and-bush/&refURL=https://t.co/MMfM0wlspg&referrer=https://t.co/MMfM0wlspg

However, the growth rate for the three months ending June hardly looks likely to come anywhere near the level that was reached in the later years of the Clinton administration.
In the second quarter of the year-2000 growth peaked at 7.5%, according to data from the St. Louis Federal Reserve. At the time that was the fastest growth level since the late 1980s when George H. W. Bush was president. It is also a rate of growth that has never subsequently been topped.

That’s right the economic growth hasn’t been higher than it was under Bill Clinton.

It did come close during the George W Bush administration when growth for that business cycle peaked at 7.1% in the second quarter of 2004.

#129 Leo Trollstoy on 07.27.18 at 2:26 pm

8 yrs and obama’s legacy is a gutted healthcare program

sad

#130 DON on 07.27.18 at 2:31 pm

#109 Mattl on 07.27.18 at 10:50 am
Like I said, in major markets there is resistance at the bottom end. A new house in Port Moody, even with lot prices severely down from say 500K to 250K, is still going to cost 650K-800K to stand up. These homes sell today for 1.2MM. It is fantasy to think that these homes are going to sell for under replacement.

Like Boston, Seattle, San Fran and NYC there is just too much demand for homes in YVR or GTA for a 50% melt without there being a major recession, or catastrophic economic even. If something wild happens, all bets off, and if that did happen, guess who would be scooping up cheap Vancouver houses for the inevitable next run up? Big money.

There is literally no scenario where homes in desirable areas of Canada drop 50-70% without the whole CDN economy burning.

************
I am not arguing the drop of 50-70% in urban areas.

You mention “a major recession, or catastrophic economic even”. Umm…isn’t that how it happens/happened in other markets? A recession always seems to be around the corner and Trump’s trade wars aren’t exactly good news for economies. Isn’t the yield curve flattening? – article in the financial post. Your opinion is valid…just not sure what you are basing your opinion on.

Sincerely,

#131 Newcomer on 07.27.18 at 2:52 pm

#120 DON on 07.27.18 at 1:29 pm
#83 Ron on 07.26.18 at 11:51 pm

#59 Mattl on 07.26.18 at 8:18 pm
#39 Linda – bingo. Which is why I get a kick out of the folks calling for 50-70% declines. Even if land was free it would cost 400k to build a small, by todays standards , new home almost anywhere.

—–

DON is right. Construction costs are part of the bubble. The level of demand has been jacking up profit margins and encouraging inefficiencies all through the supply chain. Even if that were not the case, replacement cost has a very weak correlation with the pricing of used goods and, were there to be a major crash, essentially every house on the market would be used. There is very little damnd for new builds in a down market.

None of that means that there will be 50-70% declines, but current building costs have next to no bearing on the market in a crash.

#132 Smoking Man on 07.27.18 at 2:56 pm

14 James on 07.27.18 at 12:39 pm
Sitting now for two days of a massive gutting on my FB stock. Biggest loss I have ever endured. Should I stay or should I go, either way I bought in in February of 2015 so all is still good. As the O-Sensei (Great Teacher) taught us to be patient and If you are centered, you can move freely. Morihei Ueshiba
As per Garth s teaching I have diversified but still have an affinity to hold on stocks over time. Its a weakness.
…..

SELL SELL SELL!!!!

When you abuse 1/2 your market with censorship it never ends well. Hope you’re not stupid enough to hold twitter, shadow banning will be the end of them.

#133 Deplorable Dude on 07.27.18 at 3:07 pm

Growth was greater under Obama in 2014 (5%). Don’t get too excited. – Garth

-————
Cherrypicker…….that was for all of 2 quarters….took a nose dive after that.

We’ll see if this short term or not. I suspect not given the corporate tax reductions, massive deregulation, and essentially full employment.

Just apologize. Quicker. – Garth

#134 tccontrarian on 07.27.18 at 3:16 pm

84 Where’s The Money Greedo? on 07.27.18 at 12:15 am

Just got a note from my soon to be ex-credit union Coast Capital. It’s full speed ahead for them to become a federal credit union. Should be finalized this fall, just in time to get bailed-in.
Funny how that works. I guess having hired an ex-OSFI director and ex-Director of Legal Compliance of BC Hydro got this fast tracked. The ex-Hydro Director was Greedo Scambell’s appointee in there to sell out the taxpayers to Greedo’s buddies; one IPP even has a former BC Solicitor General under Greedo as Director to give him steady work with those 50 year contracts to pay multiples of the going rate for power.
I guess Coast’s next step is get themselves on the stock market, issue shares and give themselves Class A shares while the members get lowly Class C shares, then sell the “bank” and walk away with millions in their pockets, leaving members with peanuts.
Just like what happened in Australia 10-15 years ago, a scandal that has now been white-washed off the internet. I can’t find anything on it anymore.
The ex-BC Hydro Director Of Compliance is Australian though he wasn’t in on the scam is Aussie land.
I wrote about this some years ago on this site but don’t know how to access the info. Maybe Garth can enlighten us with this info.
It was very sleazy what they did to those CU members.
********************

Interested in this. If can find it, please post more info or links to whatever happened in Australia.

“It’s full speed ahead for them to become a federal credit union. Should be finalized this fall, just in time to get bailed-in.”

I’ve been a member for some time and when I saw this I also thought about ‘why’ they’d want to do this – of course, being eligible for a bail-in would make a whole lot of sense!

TCC

#135 AGuyInVancouver on 07.27.18 at 3:24 pm

13 Jimers on 07.26.18 at 4:57 pm
Facebook with eventually pay the price for being a Left-Wing political machine, topped off by Zuckerberg’s failed run for President 2020. A ‘social’ platform that does not allow conservatives to express opinions will never be considered open enough to be successful.
_ _ _
LOL, that’s right, it is all a vast Left Wing conspiracy. Why is it Trump supporters are always paranoid, tinfoil hat-wearing crazies?

#136 Where's The Money Greedo? on 07.27.18 at 3:44 pm

Re: #95 crowdedelevatorfartz on 07.27.18 at 8:13 am
@#89 Where’s the money Greedo
Re : Former Liberal Premier Gordon Campbell

Well, I guess his “life on the lam” in London England as a trade Commissioner was long enough.
He’ll now be back in Canada working with Doug Ford in Ontario.
I can only imagine what their paying him for his “advice”
++++++++++++++++++++++++++++++++
Yeah, advice on how to set up a money laundry service, to go along with Great Canadian Casinos running in Ontariario……
I’m surprised that Coleman and Clark aren’t being picked up to navigate the legalese to circumvent their corruption-laundry laws, as they’re so fluent and experienced….
I guess triple-delete is coming to a province named Ontario, hahah.

#137 DON on 07.27.18 at 3:52 pm

https://business.financialpost.com/investing/facebook-shares-plunge-after-earnings-fall-short

“Facebook fallout shatters myth of big tech’s everlasting upward trajectory
The decline was roughly equivalent to the entire value of some of the best-known companies, including McDonald’s, Nike and 3M”

Could this add to the slow change in sentiment? Unlimited growth???

last post – I promise.

#138 Mattl on 07.27.18 at 4:10 pm

Don – I don’t even bother to predict direction of the economy. Garth seems to believe there is no major event in the near future and I trust his judgement. My opinion on RE in major markets is we are going to see a slow melt and slow recovery.

Our family’s financial planning assumes no growth in equity on our home for a decade or so. I suspect over the next 20 years we match or beat inflation but who knows. I know sound like a RE bull sometimes but thats more to counter the doomers. I would not encourage anyone to stretch tobuy in the GTA or YVR but those that can afford it and can find good homes in desirable areas will be ok.

And if some major event hits, well all of us shrubs are in trouble, rent or own.

#139 Tony on 07.27.18 at 4:17 pm

One of my comments on youtube TWO days ago. TIMESTAMPED:

parkerbohnn
2 days ago
Twitter seems destined to be the first of that lot to go bankrupt. Long term facebook looks the surest to go bankrupt.

https://www.youtube.com/watch?v=M9fRkVmtMdk&lc=z22xfliqrx3yensvracdp430syugybwsc0v4m432cb1w03c010c.1532494304829512

#140 Blacksheep on 07.27.18 at 4:36 pm

Don # 123,

“Blacksheep you resorted to extremes in your argument, not every seller is a crook or buyer a victim.”
——————————————-
Of course this type of reasoning is extreme AND flawed.

But that IS, the point I was making:

“Picked up for 3.16 in June 2016”

“probably hoping to find a victim to rob”

“that isn’t paying attentiion”

Does this sound like a remotely balanced perspective, considering the observer has zero insights into the actual seller or buyers situation, beyond some online numbers?

#141 conan on 07.27.18 at 4:47 pm

Is that Stormy on the left?- penny henny

Nope, stormy is built for comfort, not speed.

#142 NoName on 07.27.18 at 6:26 pm

@Tony on 07.27.18 at 4:17 pm
One of my comments on youtube TWO days ago. TIMESTAMPED:

parkerbohnn
2 days ago
Twitter seems destined to be the first of that lot to go bankrupt. Long term facebook looks the surest to go bankrupt.

https://www.youtube.com/watch?v=M9fRkVmtMdk&lc=z22xfliqrx3yensvracdp430syugybwsc0v4m432cb1w03c010c.1532494304829512

you robbed me out of 3 min of my time… i’ll never forgive you.

dude sees only 2 electric car manufactures and one is tesla, company with all open patents for everyone to copy or improve uppon it, for electric car…
Honda and toyota started working on fuel cell cars aroung 2000, i can see those being more enviromentaly frendly vs battery. Cant remember who but someone made fueling station size of fridge that uses nat gas to extrac hidrogen.

i wish youtube dud will make a video about 10 reasons for renesance nuclear power coming.. that would be very funny!

#f150
https://www.youtube.com/watch?v=kLkSukx1sCw

#143 Taikun on 07.28.18 at 11:14 am

ETFs can have counterparty risk which is more risk than the underlying.

Many brokers, like Interactive Brokers, allow investors to allocate across stocks. So, take your investment amount and allocate it to the percentages of your favourite ETF. Buy Goldman, GE, GM

Less risk.

#144 Barb on 07.28.18 at 1:38 pm

“Faceplant”…

That’s one of your very best, GT!