The lower low

Here’s the context for the nation as a whole (or hole). Four things to remember as you peruse the shocking data below. A single malt scotch would also help.

  • Real estate sales across Canada plummeted over 9% last month.
  • Houses just lost more than $30 billion in value. The first decline in a decade. That’s also thirty billion less in equity that 9.5 million homeowners possess. Work it out.
  • Economic growth in Canada has ground to a halt, and…
  • Family debt just hit another all-time, epic, record-breaking high.

With that in mind, let’s whisk to Vancouver. That city led the market into a FOMO-inspired orgiastic frenzy in 2015-6, and is now on the leading edge of the largest housing market correction since 1991.

Local real estate poohbahs have been working overtime to mask the depth and speed of the plunge now taking place. Buyers have retreated in fear as Mr. Market and Comrade Premier Horgan team up to deliver a fatal one-deux blow to YVR. As if five central bank interest rate increases and a tough borrower stress test weren’t enough, tone-deaf politicos added in an extreme foreign buyer tax, a speculation tax which has nothing to do with speculation, an empty houses tax on the wealthy and a special property tax in demand hoods. As a result, the market is truly and well rolling over – as official stats will reveal in a couple of weeks.

Meanwhile, here’s a report from one insider unafraid to be truthy.

“March is projecting to come in 30% below the lowest month ever in recent history, more than 50% below the average, almost 35% below last year (a bad year) and 70% below the best month. The stats are coming in even worse than an average Jan or December.

“If I straight-line the MTD to the whole month, we could come in at 1500 sales – but to be generous, I’m projecting 1600 – – So here are the numbers for history. And – we are about to go into Spring Break – so perhaps that makes it even quieter!!!”

Below are the sales numbers for the month of March reaching back 13 years. If March of 2019 does come in at 1,600 sales, it would be 52% lower than the average of 3,318, a third below the weakest month and, as our whistleblower reports, an incredible 70% dive from the spring of 2016.

Now, given the four scary points at the outset of this post, it’s hard to see what will arrest the downward momentum. The economy is slowing, households are already indebted as never before, and buyers are running for the hills. Even a budget on Tuesday sanctioning 30-year mortgages and offering a new buyer tax credit might be lame when facing this wall of fear. After all, if sales are collapsing, then prices are bound to follow. So why would anyone buy a house now?

Naturally, all real estate is local. Doug Ford is not John Horgan. Even Rachel Notley ain’t that rabid. In most markets the locals haven’t been as extreme, obsessed or paranoid as in the LM. But realtor numbers show 75% of Canadian markets are sliding or in distress, while StatsCan confirms debt-to-income ratios have hit historic highs in Toronto. The decade-long plunge into a single asset class, which has forced prices to levels that were undreamed-of when this pathetic blog began, is a dangerous social and economic phenomenon.

If you need to buy this spring, can afford it and understand the risks, go ahead. Mortgages are cheap and we all need a place to live. But now real estate is an expense, not an investment. In most places, at this moment, you stand a greater chance of losing money than making it.

Make sure your spouse gets it.

 

126 comments ↓

#1 Ace Goodheart on 03.17.19 at 2:34 pm

So I managed last year to find a good EFT that tracks the Dow Jones Industrial. I picked up 20K US of this thing:

SPDR

Ended up making slightly over 11%

Which translates to $2200.00 US dollars.

Then there’s that stupid withholding tax. But oh well.

Things were in a bit of a funk when I figured out that I just desperately needed to own a chunk of the Dow Jones, so I managed to figure out a half decent ETF to own it with (run since 1998, 21.52 billion dollars in assets held, pays a 2.05 % dividend (actually slightly over 3% at the price I paid for it), and tracks the index like a Tesla tracks the white lines on auto pilot).

At any rate, that’s what I’ve been up to lately.

#2 Smartalox on 03.17.19 at 2:37 pm

Looking forward to seeing the REBGV numbers for March. April and May are surely looking to be worse, still. But we’ll see how far thing fall by assessment day: July 1st. Looks like there will be enough time for another round of price reductions before then!

#3 patty twinkle toes on 03.17.19 at 2:43 pm

Sounds like current state of things in Canada sucks…..but what do i care?? or anybody else who has their shit together? Am i supposed to sit on my high horse and look down at the fiscally irresponsible consumer suckers with shame? Should we try to help these people? How does one go about assisting someone who doesn’t want help? sigh

#4 pay your taxes on 03.17.19 at 2:51 pm

Garth, I live and work in YVR and have friends who range from paupers to guys who own several houses here on the North Shore. Not a single one of them has bellyached about Horgan and the way the market is going. Everyone here seems to agree that something had to be done and this appears to be working. Like any investment, one must take a long term view and accept the fact that the market sometimes takes back some of your gains.

We lived under corrupt Liberal (Socred) governments for a long time, the depth of said corruption is still being plumbed after the former leaders parachuted into their private sector directorships paid for with our tax dollars. If Horgan is corrupt it is not yet evident. His approach is refreshing. Those of us who have lived here for 50 plus years also see the effects of money laundering and foreign “investment”. Hopefully things can be straightened out before all of our young people are driven into the hinterland.

How is it working when sales crash and buyers freeze? The seeds of economic difficulty are being sown. – Garth

#5 SimplyPut7 on 03.17.19 at 2:52 pm

So when all those investment condos hit the market, who’s going to buy them?

Which lenders are going to finance them?

Or do the speculators really think their bank is going to let them dump the place on their HELOC without the HELOC rate rising drastically?

#6 TurnerNation on 03.17.19 at 2:54 pm

The fact that the hiring and promotions in Kanada is set by merit of SJW policies already told me we are in a decline. The best and brightest will suffer or get out.

#7 Willy H on 03.17.19 at 2:55 pm

It’s awfully hard to spur real incremental economic growth when consumers are pickled in mortgage and consumer debt. The only real driver of economic growth is immigration.

It’s downright desperation when our federal government is about to incentivise house buying when our one-trick pony economy is dangerously overly reliant the housing sector to begin with.

Real incremental growth will only come with innovation, growth in value-ad sector (processing our natural resources) and increases in worker productivity. Canada has a poor record on all three.

#8 Andrewski on 03.17.19 at 2:56 pm

Horgan (& his team’s) real estate cooling actions will hoist his own petard & therefore eventual defeat in BC’s next election.

#9 Tony on 03.17.19 at 2:59 pm

The residents of Mississauga and Brampton will pay anything if they can get a mortgage. Expect sales to spike upwards in both those cities after the budget speech. The new buyers’ credit will do nothing as new buyers can’t afford anything. Vancouver will continue to fall in price. We’ll probably see a spike in GTA prices in the coming months especially at the low end then a flat-lining and then a price decline while the greater Vancouver area continues to fall unabated.

#10 baloney Sandwitch on 03.17.19 at 3:00 pm

No hurry. I bought my first home at the top of 1989 and lost 30% of equity when I sold in 1995.

My experience is that it takes about 4 to 6 years for a RE bubble to bottom – it always overshoots. Looking at the 1989 peak in the GTA and in the US GFC for inspiration.

#11 Alessio on 03.17.19 at 3:01 pm

Yikes. Had I not read this blog I’d think all was rosy in canada! House prices still frothy – People made a ton of money. Rent keeps increasing – A lot of Investors are doing well. Stock market forging higher – People are still making a ton of money. Lots of expensive autos vacations and Gucci wallets floating around. Lots of cranes. Unemployment historically low. And….our 8 month winter looks like it’s finally making way for our 1 month spring and 2 month summer. But now I’m worried.

#12 pay your taxes on 03.17.19 at 3:18 pm

How is it working when sales crash and buyers freeze? The seeds of economic difficulty are being sown. – Garth

Those seeds are germinating now, but as you have often stated, were sown long ago. Record low interest rates, long amortizations, CMHC 5% down payments, and lax lending standards all played their part. In light of those, foreign investment and money laundering were late to the party and only played a minor role (also your assertion). The real estate bubble appears to be deflating in most major cities in the world. We certainly aren’t unique.

There are a few posters who believe that the central bankers are corrupt or incompetent. I don’t hold those beliefs. They’ve been handed a lot to deal with since 2008 and have done a fine job of keeping things normal for as long as they have. Hopefully they’ll buy enough time to figure out how to unwind this debt bubble before the whole thing comes crashing down, housing and all.

Happy Sunday, and as always, thanks for your time and your blog.

#13 TurnerNation on 03.17.19 at 3:22 pm

Tarry not in the wine this St Patrick’s day Blog dogs but drinketh of green beer.
While you can. I have a feeling the T2-led UN regime will be banning this collective practical day owing to some head-hanging inducement their will parry. (Our past or something)

#14 Frank on 03.17.19 at 3:24 pm

I like your brutally honest incite on consumer debt and house lust but your political bias is so blatant and ignorant it’s embarassing to read.

I didn’t vote for the NDP here in BC but watching you refer to our primier as “Comrade Horgan” is pathetic. It’s Trump-like name calling because someone doesn’t share your political views. Then your hypocritical blaming of the NDP for ratcheting up the foreign buyer tax as “extreme” despite your insistance for YEARS that the housing rises were a local issue and not the Chinese boogeyman. In fact after stats came out here showing <10% foreign ownership you said "see I told you". Yet since the NDP took power you haven't missed a chance to cite how the foreign buyers tax has contributed to the real estate slowdown. So foreign buyers are a myth unless you can use them to slag someone with different political views than you.

You embody everything that is wrong with partisan politics in the world today. Please just stick to finance.

#15 Frank on 03.17.19 at 3:26 pm

That said. On the ground observance of Vancouver has me thinking the whistleblower must be right. I haven’t seen so many open houses with so few people in a decade.

#16 NoName on 03.17.19 at 3:27 pm

Oh, picture is funny every tim i aks my son how we will name his dog when he gets one he tells me hot-dog dog.

Press Play !!!

https://youtu.be/lHhheCf0G1I

#17 Mordko on 03.17.19 at 3:28 pm

Vancouver is a special case not just because of the extraordinary dumb government but also because it went up and down along with major cities across the world – London, Melbourne, Hong Kong… Chinese economy and capital controls are also having an impact

#18 Orgiastic on 03.17.19 at 3:29 pm

I didn’t even know that was a word.

I have said so very many times, there was just no reason for house prices to shoot to the moon in the first place. We all felt so entitled to multi million dollar homes for some god unknown reason.

As someone that owns a home and is in the throes of a self led renovation, and in tune with the exorbitant building costs, it’s very clear that things simply are not sustainable. The expectation to afford high costs is simply to take a loan or HELOC. As home values crater, that will change and so will building costs.

Back to reality as Garth says. The orgiastic days are done.

#19 45north on 03.17.19 at 3:33 pm

With that in mind, let’s whisk to Vancouver. That city led the market into a FOMO-inspired orgiastic frenzy in 2015-6, and is now on the leading edge of the largest housing market correction since 1991.

Local real estate poohbahs have been working overtime to mask the depth and speed of the plunge now taking place.

Wolf Richter: The Most Splendid Housing Bubbles in Canada Deflate

Richter is saying that the Canadian housing market is more inflated than the US. There were two housing bubbles in the US: the first reached its peak 2006-2007. The second bigger bubble, reached its peak in 2018. The Canadian housing bubble surpasses both. He overlays Vancouver with San Francisco. Toronto with San Francisco. Montreal with San Francisco. The implication is that Canada is due for a stunning drop in the price of its housing markets. The Canadian housing bubble has to burst. Richter says that it is bursting. Right now.

https://www.howestreet.com/2019/03/16/the-most-splendid-housing-bubbles-in-canada-deflate/

Even a budget on Tuesday sanctioning 30-year mortgages and offering a new buyer tax credit might be lame when facing this wall of fear.

yeah, they’re lame

#20 yvr_lurker on 03.17.19 at 3:38 pm

#4 I agree completely with this comment.

——————————-

The situation was completely out of control in 2016, and the liberals in BC were corrupt, turning a blind eye to money-laundering, casinos, the effects of parasitic foreign “investment” driving scores of locals to the hinterland. The steep decline now is the antithesis to the runaway gains that took place over a few years from 2015-2017. Hopefully young people (those without mega trustfunds and rich parents abroad) will be able to afford to live in YVR and create businesses and not feel the need to go elsewhere to seek a decent life. Hopefully, the city can mitigate the huge property tax spikes that drives so many local businesses to shutter their doors (go look on Denman, lower Roson, broadway st etc… so many businesses gone due to sky-high rent and property tax spikes passed on). Garth, I believe that you are not willing to understand how difficult it had become to make a go of it in the city for LOCAL citizens and small businesses. I emphasize LOCAL citizens here; as the job of Gov’t is not to make the city appear cheap to “investors” sitting on their computers in some foreign country buying up whatever they can, or local speculators buying up their fourth condo for flipping before the move-in date.

Eventually prices will settle at some significantly lower level and I am sure the buyers will be back after the re-stabilization. it will take us a few years given the zero controls that were in place for about 15 years during the run-up. Hopefully, the voting public will no longer be gullible and so readily able to be hood-winked by some politicians and developers, working in tandem, who want to make YVR a “world-class” city. Their definition of “world class” (condo tower after tower for purchase by foreign buyers and so on) is not my definition of world class.

#21 Bellyache on 03.17.19 at 3:39 pm

#4, the nugget in your voice seems to be that you bought into the market many years ago and can afford some downside. Those that just dropped one or two million on a place and saw 6 figures disappear a few days later will surely not be as smug. How does it go … buy high and sell low. As soon as that avalanche picks up speed, the casualties will start accumulating. You can also bet your dollar that anyone of retirement age without a diversified portfolio is thinking of cashing out or fearing forever loss. We are all human after all.

#22 Honest Realtor on 03.17.19 at 3:41 pm

“A single malt scotch would also help.”

Just one? You sure you haven’t been out binging on JD with Smoking Man, Mr. Turner? Or is it just the switch to Daylight Saving Time that has made us all a bit nutty this week?

Lately (for a month or two I figure) your blog has become what I can only describe as rather erratic, to say the least. While I usually disagree with your overall negative view of real estate, I cannot now make much sense of how you are getting your direction. I appreciate that much of this you are taking from your own readings of the market, but it is still very confusing for readers.

One week ago, (yes just 7 days ago!), you said that…

“House prices may well be higher by September than they are now.”

https://www.greaterfool.ca/2019/03/10/sprouts/

That column was, in my opinion, a more reasonable assessment of the dynamics of the spring market, and I still see that as the most likely reality.

In sympathy, stats do come out all the time that can be contradictory, especially comparing different regions, and I see you are trying to look across the country.

Still, my message to buyers and sellers is to stay the course, be reasonable and optimistic. It should be another good year here in Ontario and the budget this week will be another plus factor.

Here’s to spring!

#23 Joe Schmoe on 03.17.19 at 3:48 pm

RE sucks. I am up to my bushy eyebrows in the junk..but fortunately discovered the rule of 90 in my mid 20s…around 20 years ago.

60-70% of our net worth is of the liquid variety.

Wife has a big job in Health Care. She is looking for change due to baffling work politics and well…change for the sake of change. She’s plugged away for the last 15 years. She deserves to try something new. Way better for me than her test driving a new husband.

I was looking at the beating we will take to liquidate and move. We have been in our house since Feb 2008 and have a rec property close by. About 20% left owing on the whole kit and kaboodle.

I used to think that holding RE for a decade or more would “wash out” the peaks/troughs…nope. It’s an immediate impact. No matter when you start. Having to sell something when the market timing is not advantageous sucks.

I truly feel sorry for people “house locked” and can’t move to better opportunities.

We can eat the loss and move on, but it was a first hand experience on how tough it can be for people.

#24 Felix on 03.17.19 at 4:14 pm

Sorry Garth, but as Chef Ramsay would say today’s pic is a bit of a ‘culinary #fail’.

Tongs are an awkward and inefficient way to prepare a dog carcass for cooking.

In my kitchen, using a rotisserie in the first place makes everything much simpler and will lead to more even cooking of canine meat with no utensil marks.

Be careful not to eat too much dog, though. It will make you dumber.

#25 expat on 03.17.19 at 4:18 pm

Down here in Florida foreclosures are exploding.
I’ve been to 3 auctions this week for foreign owned townhomes that were foreclosed.

All europeans

There are 2 chinese ones next week.

It has been my experience that when we think local we don’t see the whole picture..

Worldwide many economies are deep trouble. Europe is in recession and possibly civil war in some countries.

A Golf Buddy here is a mainland Chinese businessman. He says its bloodshed in China right now..

#26 mitzerboyakaQueencitykidd on 03.17.19 at 4:25 pm

Fake win daddy’s boy with the orange comb over hair Doo wouldn’t last 15 minutes in a real biker bar that’s even after they’ve played with him for a while.

luv iz luv
hate is hate

#27 espressobob on 03.17.19 at 4:32 pm

# 1 Ace Goodheart

W8ben form might help a bit with the withholding tax thingy. This can be done online with a discount brokerage account. Beats the old paper form which is easy to screw up.

#28 Math Guru on 03.17.19 at 4:36 pm

“Houses just lost more than $30 billion in value. The first decline in a decade. That’s also thirty billion less in equity that 9.5 million homeowners possess. Work it out.”

That’s ~$3,100 per household. Thats not even worth mentioning.

#29 Nice Dog Picture on 03.17.19 at 4:38 pm

The caption depicts the barbeque is ready to roast up a hotdog. That doggy is a dachshund known as the weiner dog.

#30 DON on 03.17.19 at 4:49 pm

#22 Honest Realtor on 03.17.19 at 3:41 pm

Ummmm… You are taking Garth out of context to suit your own disbelief. How about talking about negative variables in front of us.

You are being dishonest with your clients if you fail to factor in the most recent negative variables. Agree that the market is falling and you want people to buy-in.

Why don’t you refute the evidence at hand rather than attacking our host.

Be Honest to yourself most of all. People are tapped out and so is our economy. If sales rise due to 30year amort…it will be short lived.

#31 rknusa on 03.17.19 at 4:49 pm

re:

Real estate sales across Canada plummeted over 9% last month.

Houses just lost more than $30 billion in value.

maybe in Toronto or Vancouver but the market is double digit booming in SW Ontario – Windsor, Chatham, London

listings snapped up in less than a week and for more than asking

#32 rknusa on 03.17.19 at 4:57 pm

in January new homes sales are down 7% in the US

does not seem to be causing any panic down here

sales down 9% in Canada and the sky is falling

guess because housing has been the biggest wealth creator in Canada so the past 19 years

housing is pretty much the only game in town in Canada

the middle class is going to be decimated

US sales down 7% year/year. Canadian sales down 9% month/month. Pay attention. – Garth

#33 adee on 03.17.19 at 5:17 pm

You are pretty good at telling everyone what is ‘wrong’ with the economy, wherever things are at – but you don’t supply any recommendations for what the government as a whole should do.

What’s wrong with house prices going down? What’s wrong with fewer house transactions? That’s the only way to find a new level. Why bother comparing current market activity to what happened in prior bubble years?

Perhaps this is why you did not make it as finance minister and are better suited to being a ‘financial planner’?

For most people, investing should mean building a low cost balanced ETF portfolio.

Who cares about taxes on empty houses and speculation if they “don’t do anything”?

#34 BlorgDorg on 03.17.19 at 5:20 pm

30-year ams will be a great big nothingburger. Maybe a little spring bump as a few SuperFools™ rush in. But it’s great politics because it looks like “the government is doing something”.

I just learned my idiot BIL’s “business parter”, a nice single early-30-something guy with ties to money in Hong Kong personally has about $20M in Canadian RE “investments”. Nobody asks too many questions, of course. They’re both REALTORS® of course.

Sounds like the fat lady might be (finally) warming up. Summer 2019 is going to be wildly interesting.

#35 Dolce Vita on 03.17.19 at 5:41 pm

#9 Tony
#22 Honest Realtor

I admire your enthusiasm since the alternative is unthinkable. Unfortunately the reality as of late in Toronto is as follows (TREB data, end of year):

2017 Avg. Price = $836,465

2018 Avg. Price = $787,300

about a 6% drop from 2017.

Hopefully something magical has happened over the past 2.5 months but honestly from the above, recent economic news, lower consumer spending, high levels of debt etc., I don’t see it.

The New Agers say “thoughts create”…I’m not so sure about that.

Still, positive thinking always better.

#36 Dolce Vita on 03.17.19 at 5:58 pm

Garth, TREB land is very vulnerable if the economy takes a turn for the worse which it has been doing.

A TREB/Ipsos Jan. 2019 survey of home buyers from Jan. 2018 revealed that:

32% owned 2 homes
8% owned 3 homes
6% owned 4 homes
6% owned 5+ homes

That’s 52% of home buyers Jan. 2018 to Jan. 2019 in TREB land are home speculators of sorts.

Hopefully, they’re in it for the long run and can afford to do so.

If not and the economy worsens followed by your usual job losses, TREB land will be a wasteland in price drops just to get out with one’s skin still attached.

#37 catralph on 03.17.19 at 6:03 pm

Toronto is still out of reach for most and could use further measures similar to B.C’s to cool the market. With our low Canadian dollar and few restrictions on non-resident purchasers Toronto is still very attractive. The claim that non-resident purchasers are not an issue is based on statistics gathered by CMHC and others using crude and unreliable collection methods that I believe underestimate the effect of non-resident investors. A collapse like in Vancouver would be welcome in Toronto except for those like you Garth who have be happily riding this real estate boom.

Huh? – Garth

#38 Paul on 03.17.19 at 6:07 pm

#7 Willy H on 03.17.19 at 2:55 pm
It’s awfully hard to spur real incremental economic growth when consumers are pickled in mortgage and consumer debt. The only real driver of economic growth is immigration.
————————————————————————————————
????? How does that driver work???
We may want to make things to sell and export to others to just trees,oil and maple syrup.

#39 Ex-Cowtown on 03.17.19 at 6:20 pm

#14 Frank on 03.17.19 at 3:24 pm
I like your brutally honest incite on consumer debt and house lust but your political bias is so blatant and ignorant it’s embarassing to read.

I didn’t vote for the NDP here in BC but watching you refer to our primier as “Comrade Horgan” is pathetic. It’s Trump-like name calling because someone doesn’t share your political views.

+++++++++++++++++++++++++++++++++

Cognitive dissonance rules! This poster sees a massive problem with GT’s political issues and then goes on to cough up their own political hairball!

Funny!

#40 Dolce Vita on 03.17.19 at 6:23 pm

Italy in recession. Japan facing recession. Germany skirting with recession. Paris burning. UK uncertainty about Brexit with no EU deal. Chinese claiming worst growth in a decade (excellent for the rest of us but bad by their standards). Atlanta Fed. GDPNow oscillating between near 0% to 0.5% growth in 1st Qtr 2019 for the Excited States of America and of course, Canada with 3/4 of the last GDP reports showing negative growth.

It’s not looking good people, no, not at all. I think the Cdn. Consumer senses this and is putting the brakes on spending and is hopefully paying down debt.

I think the plucky Cdn. economy can produce 1 positive month in 1st Qtr 2019 but after that, probably by May, a technical recession will be declared for all intents and purposes.

And due to Globalization, any recession nowadays will be exacerbated.

Hope you’re happy all you gung ho Globalists. As I said before, the broom does indeed sweep both ways. Enjoy your intertwined World economies where recession, unlike Real Estate, IS NOT LOCAL.

The ’81 to ’82 recession which if you count unemployment lingered for 4 years will seem a walk in the park for all the economic reasons stated by Garth.

To quote George Carlin from his “The Planet is Fine”:

“Pack your shit, folks. We’re going away. And we won’t leave much of a trace, either. Thank God for that. Maybe a little Styrofoam. Maybe.”

-Ya I know, Buonanotte from tech. recession Italia.

#41 Minister Of Finance on 03.17.19 at 6:27 pm

#33 adee: – Are you referring to Big Jim who ate his bacon, eggs, and toast using his hands. The Finance Minister who lied to Canadian investors who lost $billions in the Investments Trusts?

#42 Ray Skunk on 03.17.19 at 6:36 pm

Sobering stuff.

Well, if anyone needs a lol after reading that, feast your eyes on this tale of “woe”/ridiculousness

https://business.financialpost.com/personal-finance/family-finance/this-womans-16000-a-month-in-spousal-support-ends-at-65-she-will-need-to-make-deep-cuts-to-survive

#43 Muhammad Ahmad on 03.17.19 at 6:39 pm

Please raise your voice to stop the Liberal Government not to relax mortgage rules as this can make housing and rents even more un-affordable. They should include private lenders in the stress test so that we can avoid the next housing crash and recession.

https://www.change.org/p/bill-morneau-mr-morneau-don-t-drive-up-home-prices-by-loosening-lending-standards-f32354e9-d7e5-4852-b2b4-d26365433e08

#44 Not 1st on 03.17.19 at 6:58 pm

Ace to get some US exposure you can get those ETFs right here on the tsx. No need to change currency and go to another exchange.

But if you just have to work in US bux then interlisted stocks are a way to avoid US withhold tax.

But you are on the right track. Keep moving those assets out of socialist debt ridden hell hole. The govt is going to be coming for it all. Wait until they announce no capital gains exemptions for primary residences.

#45 crowdedelevatorfartz on 03.17.19 at 7:04 pm

@#15 Frank
“I haven’t seen so many open houses with so few people in a decade.”
*****

I have watched the same newly built house on the market for over a year….different realtors but it still hasnt moved.
No one , ever, at the open house.
You think they might drop their price unless …..they cant…..

#46 Matte on 03.17.19 at 7:13 pm

Awesome! The dip can’t come fast enough, hopefully the 1-2 punch in BC knocks the market flat. Perhaps a 200k income will buy more then mediocrity, once it bottoms my family (self made, parents gave me nothing and all my income made in Canada and taxed the shit out of as an employee) can afford the type of luxury housing being a 1% er should afford and not be pickled in debt. :) thanks Johnny H.

If real estate loses 50% you might not be a 1%er any longer. Be careful what you wish for. – Garth

#47 Ace Goodheart on 03.17.19 at 7:16 pm

So it’s almost time to re start that ridiculous yearly ritual of driving 2.5 hours up to an uninsulated, open sewered, third world water supplied, mostly generator powered (we do have hydro sometimes, but it’s not reliable), home built concrete pilon (not the right concrete, I’m told, something about “PSI”) carpenter ant infested building known as a “cottage”.

Garth hates these things. I get it. It’s a waste of money. It’s a lot of work keeping it from falling down. Why get drunk at the lake when you can stumble around your own neighbourhood (at least the police know where you live and can take you home when they find you passed out in someone’s flower garden).

The kids start texting as soon as we hit the road. By the time we are mostly there, they have the weekend set out. We learned a while ago that you don’t try to meet people up at the cottage, and then make your kids be friends with their kids. This doesn’t work. What you do is let your kids work it out, and then make friends with whomever parents of whatever children your kids decide they want to know.

It is easy to do anyway as by the end of the first night, everyone is mostly in the bag, so making friends with randoms you might not want to know otherwise is pretty easy at that point.

So the kids determine the social life, we follow along, and by the end of the weekend everyone usually ends up at one cottage or another, where one of the infamous lake parties takes place, and things that should never happen, tend to (what happens at the cottage, stays at the cottage).

By Sunday everyone trundles back down to their jobs and their mortgages and their sober lives.

Yeah, it’s nuts. It’s like a release. It’s definitely crazy. But it keeps us sane.

We paid $188,000 for the place, back in 2009 (bought it from some dude who lost his pension in the financial collapse and was facing financial ruin if he didn’t start selling things – still had a small mortgage on it). We paid cash. Never mortgaged it.

We could sell the land now for upwards of 500K. The building is worthless.

But why would we? It’s so much fun…….

#48 Tell Me More on 03.17.19 at 7:24 pm

#31 rknusa: – Did you know what happened to Windsor, Chatham, London, and lets not leave out Hamilton during the last crash of the late 1980’s into the early 90’s? Real Estate went down like a waterfall with no ending, and took many years to come back to a modest recovery. Condos were toast with Power of Sales everywhere.

#49 Figure it Out on 03.17.19 at 7:29 pm

“Please raise your voice to stop the Liberal Government not to relax mortgage rules […]”

It’s a $350 billion budget. It’s in the can. It’s at the printer’s. Barring outbreak of war, nothing planned for the budget will change between now and Tuesday. Que sera sera.

#50 Linda on 03.17.19 at 7:32 pm

I’m with #3 Patti here – people do not seem to want to hear anything but rainbows, ponies & fairy dust when it comes to their less than wise economic choices. For the truly sensitive to criticism types, even the most innocuous of comments can trigger an over the top raging reaction. For sure, no matter what it will NOT be accepted that any of the choices they made had anything to do with the fiscal mess they face. It will always be something or someone else’s fault & they will be the innocent victim. Plus, the government should do ‘something’ to fix things (in their favour, natch). Too bad this is happening during an election year. I see lots of taxpayer dough being funneled into the hands of those who were unable to manage the dough they had in the first place.

#51 AB on 03.17.19 at 7:39 pm

#14 Frank
A wee bit testy in YVR are we?

#52 Looked For First Time on 03.17.19 at 8:10 pm

The one plus one condo I should have bought at 123 Eglinton East in the late 1990’s for $140,000 is now selling for $630,000.

#53 Vampire studies on 03.17.19 at 8:19 pm

30 Don – I think there is still a huge personal responsibility people must take for their decisions. A
knowledgeable buyer will know the market is falling,
but no one knows how far and for how long. If a property fits the bill, and is affordable to that buyer, why not buy even if the market might drop an unknown amount still.

#54 Vision on 03.17.19 at 8:32 pm

#3 patty twinkle toes
Am i supposed to sit on my high horse and look down at the fiscally irresponsible consumer suckers with shame? Should we try to help these people?
—————-
These are the same people who bragged how their homes had gone up much! These are the same people who bought real estate, flipped it and bought another two homes or something bigger.
Time to pay the piper when prices go downa, downa..
Do I feel sorry? No!
But, I am sure taxpayers will help these types because they will be crying the blues and then government
will step in.

#55 math on 03.17.19 at 8:38 pm

#52 – about 6.5%, which is above the norm but doesn’t consider condo fees, mortgage interest, property tax and selling costs. of course, if you lived there then totally worth it – gotta live somewhere!

#56 Smoking Man on 03.17.19 at 8:42 pm

Zero wage growth, ridiculous taxes, paying bills and getting by on helocks.

Real estate in Canada the shittiest asset class to hold for the next 10 years. Spring market is a bust.

Panic to set in.

If you can, get the hell out of Canada, Trumps america not bad.

#57 Kamloops Realtor on 03.17.19 at 8:44 pm

LP- chill out girly, Come to Kamloops and I will sell you a nice cheap spec, what’s your price range….

#58 Millmech on 03.17.19 at 8:55 pm

Looked at a multiplex this weekend,cap rate of 6%,it already has drop 16%, but it needs to drop more so that cap rate is 12%, I can wait ,no offers after 4mths on market it will come down more. This is where the money gets made!

#59 Lorne on 03.17.19 at 9:02 pm

#14 Frank on 03.17.19 at 3:24 pm

…..
Well said, Frank.

#60 50 YEARS OF MAPLE LEAF INCOMPETENCE! on 03.17.19 at 9:18 pm

All real estate is local – and so is sports franchise incompetence!

Make Believes CHOKE AGAIN!!

Crushed by the losing-record Senators, 6-2.

A spring time of real estate and sports misery lies ahead for Toronturds :(

Enjoy it all while you’re waiting at the garage getting your suspension fixed because of the pothole damages caused by your incompetently managed and decaying municipal infrastructure, LOL!

Bang, bump, bang, CRASH!!!

#61 John Roberts on 03.17.19 at 9:19 pm

I don’t know what to think of you Garth. For the longest time you blamed governments for not doing enough to ease runaway real estate prices. Now that government actions are having the desired effect, you trash them. I don’t respect your trump-style right-wing political agenda. Please stick to writing about stuff that appeals to readers of your blog. The world has enough political hate.

Clean your lens. Politicians that pump real estate have been trashed here for years. Politicians who distort and crash it get the same treatment. Market forces should dictate the market. – Garth

#62 Ace Goodheart on 03.17.19 at 9:20 pm

So reading tonight about how Universities have to stop advertising themselves as places to party, drink alcohol and get busy with the opposite sex.

Actually, they were talking about frosh week, but I get the idea.

I’m thinking, NO! Don’t do that. That is the only reason why any of us went!

You spent most of high school dreaming about the co-ed dorms, non stop parties, drinking, all the girls (or guys) you could meet, as set out in the various college themed movies of the day, and confirmed by whatever literature you could get your hands on from the various student organisations promoting frosh week festivities.

After having gotten pretty far in life making all the right decisions for all the wrong reasons, I can honestly say that if they take away the dreams of the high school undergrad and replace them with the cold reality of early morning classes, mid terms, projects and final exams, no one will ever go to college again. The party sells the school. That is why the kids go.

You go because life at the parents’ house is intolerable, your friends are boring, the girls (or guys) you are able to get are just not doing it for you anymore, and you want a rush of something else, that excitement that comes from watching “Old School” or some other college themed movie.

You end up with three degrees and a marketable skill that you can use to build a multi million dollar business on. But you didn’t go there for that. You went for the girls and the party.

Oh well. They have dull washed everything else in this life with borningness and “let’s be friends” Mr. Rogers style social interaction. Why not destroy college……

#63 Gulf Breeze on 03.17.19 at 9:28 pm

#4 Pay Your Taxes,

Agree with you. It’s been my experience too. I don’t know anybody who disagrees with Horgan. Garth has illuminated the downside, of course.

But the downside of letting the market just take care of things doesn’t work in an international real estate market, policed by corrupt local politicians who turned a blind eye to rampant money laundering.

Horgan’s interventions alone have not curtailed dirty foreign money. What they have done is served as a warning. The provincial government will back up the detailed reports on laundering money through real estate, coming up sometime this month with demands to deport or charge the criminals.

If Trudeau interferes in this process, he will not be reelected. This is a HUGE issue here. The biggest.

#64 When Will They Raise Rates? on 03.17.19 at 9:45 pm

If you need to buy this spring, can afford it and understand the risks, go ahead.

Not yet. Soon.

#65 I see debt people on 03.17.19 at 9:59 pm

The thing I don’t get about the rising level of debt people is why isn’t affecting behavior. When I go to the mall, it’s busy. People are still buying stuff they don’t need. The new BMW’s are rolling off the lots. The ski hill today was jam-packed and lift tickets were C$115, and everyone had new skis except me. Calgary played in Winnipeg the other night and by the looks of it the place was sold out. Little Johnie is still playing hockey or soccer. Costco is still selling a ton of TV’s.

Anyway my point is I can’t tell these debt people from the living. They all look the same to me. The debt act as if they are perfectly fine.

I am not debt yet, I learned a long time ago not to buy things I could not pay for cash, except for a house or investment, something that has a positive cash flow or a cost of rent avoidance. I am back from the debt, if you will. But yet we are all debt some day.

Maybe it’s for the best. If the debt cannot tell they are debt maybe it’s best if they continue on a few years in their delusions of being alive before the accountants from above and below take them to their final audit.

There is an old saying: “He who has the most toys when he dies wins!” But perhaps that needs to be revised: “He who stiff his creditors the most when he debts wins!”

#66 Grey matters on 03.17.19 at 10:04 pm

#14 Frank on 03.17.19 at 3:24 pm

Wow… Talk about being “Frank” ! It sounds like Garth’s political views have Frankincense’d you.

#67 What Built Richmond on 03.17.19 at 10:26 pm

Today at Romania Country Bread in Steveston there were some people wearing campaign buttons that read “Tour Richmond — Money Laundering Capital of China” I thought that was good satire

#68 Dave on 03.17.19 at 10:49 pm

This is a doomer blog

#69 Wise Old Owl on 03.17.19 at 10:58 pm

Happy Saint Patrick’s Day to all!

#70 Tom from Mississauga on 03.17.19 at 11:03 pm

Hi Garth
FYI, according to some of our retail partners, retail sales ain’t any better. Everyone was hoping for a March recovery as February was a catastrophe. It’s the brick and mortar that are really getting creamed. Busy people earning good enough income to buy stuff get it online.

#71 TurnerNation on 03.17.19 at 11:34 pm

#13 TurnerNation – slow day replying to own post. Geez I just now saw the furor/mock furor around T2’s St. Pday tweets. I don’t follow social media. (Luckily.) How did I know earlier to post that?
Dunno just a feeling how things are going….my worst nightmares…come true. It was nice while it lasted:
https://www.narcity.com/news/canadians-ripping-apart-justin-trudeau-over-his-st-patricks-day-tweet

#72 j. stein on 03.17.19 at 11:36 pm

NO GLOOM AND DOOM! THINGS ARE ONLY GETTING BACK TO NORMAL! IS THAT SO ABNORMAL?

#73 Comic Sans on 03.18.19 at 12:19 am

Hey. People have to live. You have a house. Live in it. Period. Enjoy your life. Life is short. Don’t worry. It will all work out. The bottom is not falling out. As much as mankind wants you to believe it’s all doom and gloom, it’s not. Live within your means, enjoy your spouse and kids, pets, location, etc., and all is well. Keep working. Why retire? Work keeps a person healthy. Retired people tend to die earlier. All is good, people. Don’t worry, be happy!

#74 Notagreaterfool on 03.18.19 at 12:22 am

Who has the boots-on-the-ground for Toronto sales in March?

#75 Frank on 03.18.19 at 12:33 am

Cognitive dissonance rules! This poster sees a massive problem with GT’s political issues and then goes on to cough up their own political hairball!

I said nothing political. Or wait you mean comparing him to Trump? That’s not political. Thinking Donald Trump’s name calling is part of what makes him a shitbag isn’t a political bias, it’s a fact of life. The US president is a loser and if you have similarities to him aside from also breathing air and having a pulse then you need to fix yourself.

#76 Bob on 03.18.19 at 12:44 am

#14 Frank.
Good on you. Well said.

Johnny H. Is our hero in BC.

#77 fishman on 03.18.19 at 12:55 am

I see Lord Black did a drive by on Jodi; calling her underqualified to be Minister of Justice. Comparing her to other Justice ministers: Sir John A., Sir Charles Tupper, Louis St. Laurent, Big Potato, John Turner, Marc Lalonde, etc. etc.
Trouble is Conrad forgot about Sir James Douglas, just like he forgot about the cameras.
James Douglas was born in1808, English planter father & Mulatto slave/freed women/ mother in British Guinea. Father educated him well & he went to work for Hudson Bay Co. He rose through the ranks & was 1st. Governor & Father of B.C. Brought B.C. into confederation with three stipulations for Feds: build a railroad, deliver mail, manage fisheries.
Douglas signed a couple small treaties with the local band around Victoria called the Douglas Treaties. He then called in all the chiefs from B.C. for a big treaty consultation process. Douglas’s wife was half Cree so between the two of them they didn’t need translators. James Douglas told all the chiefs to go back to their territories & never ever sign a treaty with the white man. Which they proceeded to do.
No big deal till Big Potato dropped Westminster & repatriated our constitution &enshrined native self government. No big deal back east cause all the Indians surrendered & signed treaties. Not so out here. Big problemos out here.
Little Jodi isn’t following the footsteps of the Fathers of Confederation. Maybe not so smart to abandon the precepts of Eastern Liberal political Canadian elite. 1/maintain power 2/ dispense patronage. Who knows? In the meantime she’s gives good schadenfreude

#78 Smartalox on 03.18.19 at 1:00 am

Well, either the Vancouver Sun will print ANYTHING, or the winds of change really ARE blowing through Vancouver:
https://vancouversun.com/business/real-estate/residential-real-estate-foreclosures-in-metro-and-fraser-valley-rising

#79 Ex-Cowtown on 03.18.19 at 1:01 am

Food, clothing, shelter…. not sure why having massively overpriced and life altering shelter costs is a good thing. All it really does is make us uncompetitive on the world stage.

Kind of like massively high energy prices, which is what the eco-wackos want too.

#80 Smoking Man on 03.18.19 at 1:12 am

How wages go up. Deregulation lowering taxes. Trump got it right.

Investors pour money where thay think they get the most yields.

I’m here in America reporting from the front lines of the American dream. The turn over at the tax farm is breath taken.

People leaving a stable job that pays real good to an even better paying gig.

To make an easy 5gs all I got to do is go on the job board and find a candidate for an open posting. It’s that desparate down here

And the then there is T2s Canada flood gates open to TFW.

Like everything else including the labour market. It’s all about supply and demand.

Without real wage growth, real estate in the big cities is doomed.

#81 paracho on 03.18.19 at 2:15 am

Positive thoughts do work but not in the context of markets or economies. In this case, many are overindebted and no amount of positive self affirmations can help them . The government will probably do a 30 year amortization ..and this will save many ..but many saw this coming..it is only the next possible band aid solution to a very big problem . Mortgage amounts will reduce on a monthly basis but the lenders will win as they will collect more interest income even with stagnant mortgage…but they will slowly increase. Even with this and other ‘solutions’…I feel many will be in trouble and will be stuck.
This is just the beginning.

https://theprovince.com/business/real-estate/residential-real-estate-foreclosures-in-metro-and-fraser-valley-rising/wcm/34a9b0ee-c120-4b9c-b888-5843bc45546c

#82 Gordon on 03.18.19 at 3:49 am

Even the extreme left can’t stomach Trudeau any longer. He’s an embarrassment to the marginally corrupt. The far left NY Times full throated condemnation of Trudeau and his cronies as entirely corrupt shows that Democrats are seeing Trudeau as a stinking liability in the next election.

https://www.nytimes.com/2019/03/06/opinion/canada-scandal-justin-trudeau.html

#83 Captain Uppa on 03.18.19 at 7:02 am

Uppa. Downa. Who know’a for sure’a?

I am going to sell my first home shortly and buy my second. Looking at a lateral move in terms of price. I did well with a big lot that I don’t want anymore and am moving to more family friendly location. On the high end, looking at 50-100K more if home is right.

Garth, I was thinking to still make my 20% down payment, but that’s it. I would hold back the extra equity from my home sale (which I have substantial) to place in my 60/40 portfolios.

Mortgage payments would be higher of course, but I’d be more balanced. Plus could always shave some interest from my portfolios if really needed to during “the crunch years”.

What say you Garth?

#84 MF on 03.18.19 at 7:06 am

#25 expat on 03.17.19 at 4:18 pm

Finally a post I agree with. Took long enough. The statistics from China have been doctored for a long time and were meaningless. We just wanted to believe them. Europe has too many economic and social problems to even list.

#31 rknusa on 03.17.19 at 4:49 pm

Just morons chasing realtor spin that “SW Ontario is the next Toronto”.

Fat chance. Not going to happen.

Everyone knows the GTA is overpriced yes, but these other places outside the GTA offer nothing in return for their also still-overpriced RE. Just ask all the idiots commuting for hours from Barrie to the GTA every day.

If a RE downturn does hit, expect everywhere outside of the GTA to get destroyed price wise.

MF

#85 Classical Liberal Millennial on 03.18.19 at 7:25 am

Get over yourself, Frank. Garth has nicknames that poke at several politicians. If that’s enough to liken someone to Trump, you must be lots of fun at family reunions. GT has repeatedly spoken up against Trump-like tactics and attitudes against immigrants.

#86 Dave on 03.18.19 at 7:45 am

Show us more Toronto charts ( please )

#87 Remembrancer on 03.18.19 at 8:09 am

#77 fishman on 03.18.19 at 12:55 am
Trouble is Conrad forgot about Sir James Douglas, just like he forgot about the cameras.
—————————————-
The erudite Baron Black of Crossharbour tends to apply the facts which best suit his homiletic du jour.

#88 the Jaguar on 03.18.19 at 8:19 am

#77 fishman on 03.18.19 at 12:55 am

Priceless.

#89 Remembrancer on 03.18.19 at 8:30 am

#33 adee on 03.17.19 at 5:17 pm
Who cares about taxes on empty houses and speculation if they “don’t do anything”?
———————————————
No one, unless you care about governments randomly confiscating wealth to back bad social policy which by the way has no proof of effectiveness. As long as reasonable by-laws are upheld, equitable taxes and owed utilities are paid and the said vacancy is not impacting the other owners enjoyment of their properties then what is the business of the state regarding occupancy?

#90 Renter's Revenge! on 03.18.19 at 8:35 am

#83 Captain Uppa on 03.18.19 at 7:02 am

Hi Captain Uppa,

I know you didn’t ask me, but you should pay for as much of the house with cash as you can and then borrow against it to invest in the balanced portfolio.

That way you can deduct the interest from your investment loan on your income taxes (you can’t deduct the interest from a mortgage on your personal residence).

You’d probably also have more flexibility on the loan repayments than on the mortgage, depending the terms of the loan.

#91 Captain Uppa on 03.18.19 at 8:50 am

#90 Renter’s Revenge! on 03.18.19 at 8:35 am
#83 Captain Uppa on 03.18.19 at 7:02 am

Hi Captain Uppa,

I know you didn’t ask me, but you should pay for as much of the house with cash as you can and then borrow against it to invest in the balanced portfolio.

That way you can deduct the interest from your investment loan on your income taxes (you can’t deduct the interest from a mortgage on your personal residence).

You’d probably also have more flexibility on the loan repayments than on the mortgage, depending the terms of the loan.

Hey Renters Revenge, thanks for the input. Not a bad idea. I just think I’d prefer to have the cash on hand, not in a loan/HELOC. You know, in case hell breaks loose and banks call them in (highly unlikely, I know). But I will think about what you’ve said. Thanks!

#92 Bobby on 03.18.19 at 9:02 am

As we see Canada rapidly start to unwind, we are witnessing first hand what happens when idiots vote in idiots.
Just imagine the money that would be collected if there was a tax on idiots.

#93 IHCTD9 on 03.18.19 at 9:21 am

#18 Orgiastic on 03.17.19 at 3:29 pm

As someone that owns a home and is in the throes of a self led renovation, and in tune with the exorbitant building costs, it’s very clear that things simply are not sustainable.
_________

We are also heading for a self led reno. We were considering buying another place, but have shelved that idea for now. There is no bang for the buck out here in the rural backwaters of Ontario until you’re spending 600K – which for us seems like a bad idea as we’re only a few years from being empty nester’s.

We’ll bide our time and see what the future brings. In the meantime, I’ll be giving the old homestead a revamping over the next few years.

Speaking of sustainability – a couple acres and all the required costs associated with getting the go ahead to build, now seems to cost about the same as what I paid for my 4 acre plot with a house and barn back in 2001. That’s before you even put a shovel in the ground.

I know two folks who shelved plans to build and chucked their lot on the MLS. Too much $ and BS. Both now also plan a reno and staying put.

#94 dharma bum on 03.18.19 at 9:24 am

#37 catralph

Huh? – Garth
——————————————————————–

https://www.youtube.com/watch?v=XVSRm80WzZk

#95 Remembrancer on 03.18.19 at 9:40 am

#42 Ray Skunk on 03.17.19 at 6:36 pm
Sobering stuff.

Well, if anyone needs a lol after reading that, feast your eyes on this tale of “woe”/ridiculousness

https://business.financialpost.com/personal-finance/family-finance/this-womans-16000-a-month-in-spousal-support-ends-at-65-she-will-need-to-make-deep-cuts-to-survive
—————————————-
Stuff like this gives the 1% a bad name, though if you subscribe to the FP then its just another day at the office and not very eyebrow raising…

While most of these expenses track for the lifestyle she has contractually negotiated, I feel like I need to call out the $450 for a 14 year old in private school as they’re really scrimping on that, should be more in the $1000 – $1250 a month range minimum for a half-decent day school shouldn’t it? That wouldn’t include spring breaks skiing in Vail and summering in Europe, either, right?

#96 IHCTD9 on 03.18.19 at 9:42 am

#84 MF on 03.18.19 at 7:06 am

Just morons chasing realtor spin that “SW Ontario is the next Toronto”.

Fat chance. Not going to happen.

Everyone knows the GTA is overpriced yes, but these other places outside the GTA offer nothing in return for their also still-overpriced RE. Just ask all the idiots commuting for hours from Barrie to the GTA every day.

If a RE downturn does hit, expect everywhere outside of the GTA to get destroyed price wise.

MF
________

Out here in the permafrost hardened scrub of rural Ontario – there are two RE markets;

1. Big fancy houses listing for 700K – 2 million that the locals don’t buy, and are worms on hooks essentially for retiring Boomers selling out of the GTA.

2. Normal houses selling between 100K-500K that the locals buy.

If the GTA gets hit – it will only be the 700 and up houses that get murdered. Not much price-wise will change in the 100-500K market as it is super competitive all the time. The high end houses here only exist due to the selling prices in the GTA – if that goes away, the same happens here.

Places like Barrie would get slaughtered though. They’ve been building subdivision houses there made from cornflakes for 900K+. That’s even more insane than a 600K GTA condo IMHO. The 400 JUST SUCKS.

#97 dharma bum on 03.18.19 at 9:49 am

#73 Comic Sans

Retired people tend to die earlier.
——————————————————————–

Wrong.

https://www.nytimes.com/2018/01/29/upshot/early-retirement-longevity-health-wellness.html

https://www.cnbc.com/2018/03/27/how-research-shows-you-can-live-longer-if-you-retire-early.html

Only in rare cases where people truly love their jobs, does continued work enhance their lives.

Also, those with zero imagination or hobbies or desires to do anything creative, recreational or educational tend to crumble in retirement.

Usually it’s automaton-like zombies who thrive on mindless routine for its own sake.

Most people hate their jobs.

if they had the money, and were debt free, they would retire as soon as possible and exit the stress and drudgery of the the rat race.

Retirement = Freedom.

Then again, there were always slaves who did not want to be free.

https://www.theatlantic.com/entertainment/archive/2010/06/slaves-who-liked-slavery/58678/

#98 Steven Rowlandson on 03.18.19 at 10:22 am

“Real estate sales across Canada plummeted over 9% last month.
Houses just lost more than $30 billion in value. The first decline in a decade. That’s also thirty billion less in equity that 9.5 million homeowners possess. Work it out.
Economic growth in Canada has ground to a halt, and…
Family debt just hit another all-time, epic, record-breaking high.”

Rest assured that the bottom is so far down that it is no where insight yet. There will be no real recovery until all the excesses in debt and speculation are expunged good and proper. What has been seen so far is the very beginning of the horror to come.

#99 IHCTD9 on 03.18.19 at 10:25 am

#61 John Roberts on 03.17.19 at 9:19 pm

… I don’t respect your trump-style right-wing political agenda. Please stick to writing about stuff that appeals to readers of your blog. The world has enough political hate.
____

Hi John,

Frankly – if you can’t handle a little dissenting opinion, just leave right now. No one gives a rip what you don’t respect. No one gives a flying **** what you think Garth’s writing should be sticking to either. Hopefully I make myself clear.

If you need everyone to think the same as you in order to feel good about the world, then you’d best find yourself some echo chamber out there.

When you’ve toughened up a bit, and can handle a few lefts and rights, you’re welcome to come back.

#100 Alistair McLaughlin on 03.18.19 at 10:38 am

@#65 I see debt people, you’re not kidding. My wife manages a big retail store. The other night she was late closing. A lady had come to the counter with a big purchase just before close and her card didn’t work. She spent 20 minutes on the phone with her credit card, and it turned out she had exceeded her limit. They nicely extended her limit for her so she could complete her purchase. She was hauling full shopping bags from several other stores with her when she came in.

Let that sink in for a moment. Card maxxed out. And she’s still in the mall shopping. The scary thing? She’s not alone. She’s normal.

That same wife of mine used to work at a bank (one of the big five), and the stories she told me about people living off their HELOCs was alarming way back in 2011-12. That people were living like that didn’t surprise her, but she couldn’t get over how many were maxing out all available credit lines, including those with high incomes. I can only imagine how much worse it’s gotten since then.

How can one not be a doomer when there are so many indebted fools out there? How does any of this resolve itself without a painful deleveraging recession lasting at least a decade? There will be a massive price to pay for all this profligacy, and it will affect everyone, not just the debtors.

#101 PastThePeak on 03.18.19 at 10:45 am

#40 Dolce Vita on 03.17.19 at 6:23 pm
Italy in recession. Japan facing recession. Germany skirting with recession. Paris burning. UK uncertainty about Brexit with no EU deal. Chinese claiming worst growth in a decade (excellent for the rest of us but bad by their standards). Atlanta Fed. GDPNow oscillating between near 0% to 0.5% growth in 1st Qtr 2019 for the Excited States of America and of course, Canada with 3/4 of the last GDP reports showing negative growth.

It’s not looking good people, no, not at all. I think the Cdn. Consumer senses this and is putting the brakes on spending and is hopefully paying down debt.

+++++++++++++++++++++++++++++++

Based on the latest avg. Canuck debt-to-disposable-income figures, Canadian consumer is definitely NOT paying down any debt…

I honestly believe the overwhelming majority are clueless to the pending debt-pocalypse…

#102 Penny Henny on 03.18.19 at 11:13 am

#52 Looked For First Time on 03.17.19 at 8:10 pm
The one plus one condo I should have bought at 123 Eglinton East in the late 1990’s for $140,000 is now selling for $630,000.

#55 math on 03.17.19 at 8:38 pm
#52 – about 6.5%, which is above the norm but doesn’t consider condo fees, mortgage interest, property tax and selling costs. of course, if you lived there then totally worth it – gotta live somewhere!
////////////

Hey Math, what if there was only 20% down?
Also you have to consider that 20+ years later there is almost no mortgage.
Plus going into the future there will no longer be any costs associated with mortgage.

#103 LivinLarge on 03.18.19 at 11:18 am

“Market forces should dictate the market. – Garth” well, can’t argue with that but in reality that scenario died in the ’50s and 60s.

After WWII, every one wanted the piece of the pie they had fought for and so many died for.

Politicians have to get reelected or they aren’t policians any more and “manipulating the markets was the only avenue open to keep getting elected and giving the vets what they wanted and were prepared to vote for.

We owed thst generation so much and the seeds of destruction were sowed by giving it to them so quickly. No so muck “wrong” but wayyyyy too quick.

#104 PastThePeak on 03.18.19 at 11:29 am

@#100 Alistair McLaughlin

Fully agree. I was just into the bank a couple weeks ago moving some monies around, and the horror stories of extreme indebtedness left my jaw on the floor. Couples with good incomes completely maxed out – some with $100K on credit cards, and little-to-no savings to speak of.

It will end badly, and you can be sure the governments will make certain that those who saved and managed their money responsibly will be made to “pay more of their fair share”.

#105 Snowbird on 03.18.19 at 11:34 am

I believe the real estate downturn in Australia is 6 months ahead of Canada. Prices are down 13 percent in Sydney.

According to the Foreign Investment Review Board (FIRB) foreign investment in housing has collapsed another 58% year to year in 2017/2018. To me this proves foreign purchases have spiked prices, just look at the chart!

https://www.businessinsider.com.au/australia-property-market-foreign-investment-review-board-firb-2019-2

Garth, do we not have an equivalent to Australia’s FIRB in Canada to track foreign investment?

#106 A Yank in BC on 03.18.19 at 11:36 am

Just out today.. one opinion on the near-term future of the CDN dollar. Holy cow. And “household deleveraging” is specifically mentioned as one of the primary reasons why.

https://ca.finance.yahoo.com/news/fidelity-sees-loonie-testing-62-090000644.html

#107 -=jwk=- on 03.18.19 at 12:14 pm

The fact that the hiring and promotions in Kanada is set by merit of SJW policies already told me we are in a decline. The best and brightest will suffer or get out.

By ‘best and brightest’ you mean ‘white males’?. What if the ‘best and brightest’ is a gay black woman?

#108 IHCTD9 on 03.18.19 at 12:26 pm

#101 PastThePeak on 03.18.19 at 10:45 am
#40 Dolce Vita on 03.17.19 at 6:23 pm
____

Aye, 60% of our GDP is consumer spending. If the big spenders get spooked – it’ll be another dead fish to lie alongside automotive, mining, oil etc.

All you young Canucks best think long and hard about making hay while the sun shines, and ensure you start building wealth – not blowing it.

It’s a long road to 65 and you’ll be travelling a broken road getting there.

#109 Barb on 03.18.19 at 12:42 pm

After a short jaunt to the USA, the customs official proved gov’t is a bank, charging $1.33 exchange on my purchases.
Then 7% PST, and 5% GST.

US$2.77/gallon gas made it worthwhile.
Versus $137.9/litre here.

#110 Headhunter on 03.18.19 at 12:44 pm

ICHTD9
Speaking of sustainability – a couple acres and all the required costs associated with getting the go ahead to build, now seems to cost about the same as what I paid for my 4 acre plot with a house and barn back in 2001. That’s before you even put a shovel in the ground.

_________________________________________
bang on kind sir
another post a few weeks back on this “artificial scarcity” shit. Canada 2nd biggest land mass, 36 million people, cant build a house on a small piece of land without prohibitive regulation/taxation

#111 expat on 03.18.19 at 12:52 pm

Back in Halifax for a few weeks visiting friends

pick your lot
pick your house
pick your condo

after 3 years of condo and subdivision building boom the open houses are empty.

Apparently chinese specs were here for a couple years and even they have left according to a builder buddy

Not according to this. – Garth

#112 Westcdn Whining Grape on 03.18.19 at 1:00 pm

My single mother used to say to me that I should not reward people for doing what is expected – poverty abounded. I have high expectations and cussed myself and others. Try telling your expectations of a “leader” and see what happens. They seem to think they are special. Someone said that I was a contrarian introvert with Tourette syndrome. Maybe so about Tourette but I think there is a lot more to me.

I heard someone say if you are not lucky then you will be judged a loser. Well, I believe in common sense and the wisdom of experience. That has nothing to do with IQ and wealth. Yet I see today’s society is building zombies (aka useful idiots). It seems to me there are a lot of “experts” looking for meaning or justification. True they can give insight but most recognize human behavior that has been consistent throughout history (manipulation through fear and greed). Guess what, I am against a nanny state but I can understand the desire. No zombie likes change particularly is it makes life tougher.

Zombies live the day and cannot plan an independent future nor can they adapt. “God” will laugh when I say my plans but I was given the ability to make choices and I will live with the consequences. But hey, I am just a guy that does not believe rubbing 2 brain cells together makes 3 although new pathways are important. I think they are only build by challenge and change. I wait to see the direction of climate change because I despise zombies. I still don’t like the taste of crow.

I elected to a 3 year fixed term mortgage renewal. I wanted to hold out longer but my finger slipped on the online website – talk about antsy. I was going to call to cancel but then I don’t know where mortgage rates are going and the rate was fair. Sides, it is a small mortgage. I am more worried about keeping other debt off the books and maximizing investment income at reasonable risk.

I want to see a ¼ point interest rise in Canada. I agree it will result in a lower standard of living in the short term but the poison is killing us slowly in the long term. Time to recognise there is no easy way out. I thought Conrad Black had an interesting comment on Jody Wilson-Raybould. https://nationalpost.com/opinion/conrad-black-snc-lavalin-is-a-sideshow-to-the-real-wilson-raybould-

I suspect whining grapes.

#113 TurnerNation on 03.18.19 at 1:00 pm

#107 -=jwk=- why would someone’s personal bedroom preferences enter into it? It’s not covered here:
See 15.1
https://laws-lois.justice.gc.ca/eng/const/page-15.html

#114 n1tro on 03.18.19 at 1:05 pm

#62 Ace Goodheart on 03.17.19 at 9:20 pm
So reading tonight about how Universities have to stop advertising themselves as places to party, drink alcohol and get busy with the opposite sex.

Actually, they were talking about frosh week, but I get the idea.

I’m thinking, NO! Don’t do that. That is the only reason why any of us went!
—————————————-
That’s why I went to Western (UWO). Just far enough from the parents to dick around but close enough to go back home on the odd weekend to do laundry.

Quite the party school up until the Saugeen stripper incident which was a few years after I graduated but I worked along side the kid that organised that infamous event.

#115 Ubul on 03.18.19 at 1:12 pm

#107 -=jwk=- on 03.18.19 at 12:14 pm

The fact that the hiring and promotions in Kanada is set by merit of SJW policies already told me we are in a decline. The best and brightest will suffer or get out.

By ‘best and brightest’ you mean ‘white males’?. What if the ‘best and brightest’ is a gay black woman?

—-

Which part of the “best and brightest” is a reference to gender, sexual orientation, skin colour, country of origin, religion, etc.? None of them.

The best and brightest by definition is “the best and brightest”, regardless of anything else.

#116 45north on 03.18.19 at 1:23 pm

Shared Services: Morneau has little choice. The government had under-invested in technology for decades by the time the Liberals returned to power in 2015, with results that could no longer be ignored. Ancient data centres were shorting out with increasing frequency, cutting services to popular websites such as those operated by Statistics Canada and Services Canada. A government-wide email system, due to roll out March 31, 2015, instead ran into a brick wall and remains incomplete.

https://ottawacitizen.com/news/politics/bagnall-spending-millions-fixing-broken-technology-projects-now-a-liberal-budget-tradition

For 30 years, I worked for Agriculture Canada. Part of my duties were to configure, install and maintain, my own servers. Not once did they short out. During the North American power crisis in August 2003, the building was without power, so I shut them down rather than have them boot up and down, without supervision. Concerning web servers , they are a simple and reliable technology. Shared Services is such a drama queen. As far as email systems, they are simple and reliable too. Revamping the email system was the original justification for Shared Services. A centralized email system was supposed to save money. Shared Services has a budget of $1.4 billion. A year. There is never going to be a time when Shared Services saves money.

So what’s the reason for Shared Services? Bureaucratic centralization. The alternative is staring them in the face: delegate information technology back to the departments.

#117 Shawn Allen on 03.18.19 at 1:32 pm

With a Federal Budget Coming…

How true is the following statement:

“One (wo)man’s tax break is another (wo)man’s tax increase.”

#118 n1tro on 03.18.19 at 1:43 pm

#115 Ubul on 03.18.19 at 1:12 pm
#107 -=jwk=- on 03.18.19 at 12:14 pm

The fact that the hiring and promotions in Kanada is set by merit of SJW policies already told me we are in a decline. The best and brightest will suffer or get out.

By ‘best and brightest’ you mean ‘white males’?. What if the ‘best and brightest’ is a gay black woman?

—-

Which part of the “best and brightest” is a reference to gender, sexual orientation, skin colour, country of origin, religion, etc.? None of them.

The best and brightest by definition is “the best and brightest”, regardless of anything else.
———————————–
Careful, jwk is already triggered and trying to draw people in to start a SJW rant about moral superiority and the direction of how businesses have been heading.

#119 IHCTD9 on 03.18.19 at 1:58 pm

#115 Ubul on 03.18.19 at 1:12 pm
#107 -=jwk=- on 03.18.19 at 12:14 pm

The fact that the hiring and promotions in Kanada is set by merit of SJW policies already told me we are in a decline. The best and brightest will suffer or get out.

By ‘best and brightest’ you mean ‘white males’?. What if the ‘best and brightest’ is a gay black woman?

—-

Which part of the “best and brightest” is a reference to gender, sexual orientation, skin colour, country of origin, religion, etc.? None of them.

The best and brightest by definition is “the best and brightest”, regardless of anything else.
___

I think jwk got a little triggered there.

Some folks must still subscribe to that male privilege/white privilege mythological sjw crazy think.

#120 The Clerk on 03.18.19 at 2:21 pm

MW is retiring or riding into the sunset.

#121 Figure it Out on 03.18.19 at 2:22 pm

FYI folks. “The Best and the Brightest” refers to a book by David Halbersham, documenting the whiz kids (right family background and alma mater, etc.) in Kennedy’s cabinet who bungled Vietnam.

Some people today talk sneeringly about the “elite” with the right connections but who’ve never (met a payroll, milked a cow, had a “real” job, whatever YOU think is essential experience for a politician or policymaker). Same usage.

Excellent book, BTW.

#122 Bob Dog on 03.18.19 at 2:41 pm

I guess Canada isn’t worth as much as we thought it was.

#123 Ubul on 03.18.19 at 3:18 pm

#121 Figure it Out on 03.18.19 at 2:22 pm

FYI folks. “The Best and the Brightest” refers to a book by David Halbersham, documenting the whiz kids (right family background and alma mater, etc.) in Kennedy’s cabinet who bungled Vietnam.

It seems the original term was somewhat sarcastic.

Currently I hear the term more commonly used to describe what Operation Paperclip was, where literally nothing else mattered, just that who could get the job done.

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

#124 Damifino on 03.18.19 at 3:29 pm

Can a quota system be fuly meritocratic?

#125 Remembrancer on 03.18.19 at 4:12 pm

#121 Figure it Out on 03.18.19 at 2:22 pm
FYI folks. “The Best and the Brightest” refers to a book by David Halbersham, documenting the whiz kids (right family background and alma mater, etc.) in Kennedy’s cabinet who bungled Vietnam.
—————————————
Yes, that was the title of the book, but Halbersham is not the first to use the phrase. Though you’d wonder how many of that crowd were actually on fake rowing teams etc given the end results.

Personally I much prefer “The Great and the Good” as a pejorative for these bright lights of society but each to their own…

#126 Penny Henny on 03.18.19 at 4:27 pm

#118 n1tro on 03.18.19 at 1:43 pm
#115 Ubul on 03.18.19 at 1:12 pm
#107 -=jwk=- on 03.18.19 at 12:14 pm

The fact that the hiring and promotions in Kanada is set by merit of SJW policies already told me we are in a decline. The best and brightest will suffer or get out.

By ‘best and brightest’ you mean ‘white males’?. What if the ‘best and brightest’ is a gay black woman?

—-

Which part of the “best and brightest” is a reference to gender, sexual orientation, skin colour, country of origin, religion, etc.? None of them.

The best and brightest by definition is “the best and brightest”, regardless of anything else.
———————————–
Careful, jwk is already triggered and trying to draw people in to start a SJW rant about moral superiority and the direction of how businesses have been heading.

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

JWK is short for ‘justice warrior king’