Mr. Reckless

Buy a house off the Internet? That you never walked through? Based on a creative realtor’s description of ‘a chef’s kitchen… 10+++ spa-like master retreat bathroom… meticulous attention to detail… on a coveted street..’? And with photos that can make a beater property look like Martha Stewart just moved out?

Well a year ago few (if any) would fall for that. No wonder. MLS property write-ups often enter the category of steamy fiction and wide-angle, filtered photography can turn a 12-foot-wide hovel into a commodious estate. But that was then. Before Covid came. This is now. After FOMO hit.

Off-the-Net sales have become common in a lot of places since travelling is a hassle, yet many want to flee urban centres for a safer, virus-free bucolic life elsewhere. FaceTime walk-throughs with a masked, gloved, Lysol-swabbed agent are a bonus. Home inspections have once again turned rare. Buyers are buying with scant protection, often in multiple-bid scenarios, and continuing low inventory levels in many places have jacked prices skyward.

On the surface, this makes no sense. We’re in recession. Unemployment’s 13%. There’s a global pandemic. The government’s broke. Whole industries are decimated. Immigration curtailed. There may be another virus wave coming. Everybody has stuff on their faces and fear in their veins. Where did all this house-buying-at-any-price bravado come from, combined with the stunning risk of securing property you’ve never actually seen?

  Former Royal Bank CEO Gord Nixon was doing some media yesterday and attributed this insanity to just two things: people aren’t traveling anymore. They’re cocooning. Everybody wants a safe house to hide in. And, second, condos are going down. The flight to SFHs is a direct result of the virus, which he says has ‘encouraged this behaviour.’

Others disagree.

Yesterday we featured rebel Evan Siddall on this pathetic blog. The head of CMHC accused other mortgage insurers of pandering to high-risk households, fomenting excessive debt and setting up Canadian real estate for a painful fall. Prices, he said, could be 20% lower by the end of the year because of joblessness, recession, Covid, the end of CERB and the coming deferral cliff. Siddall described the ‘dark underbelly’ of the market, and did so in a stark, historic, three-page letter to his competitors, the industry and the nation at large. The stir was palpable.

So we have a real dichotomy here. Eager, almost panicked, buyers snorfling new levels of debt and paying whatever it takes to get homes they often have not visited, and a grizzled industry pro warning that the sheep have no idea what awaits them at the bottom of the chute.

Yesterday the mortgage brokerage business was agog at CMHC’s brash berating. Leading the resistance was veteran broker Rob McLister who detailed seven reasons he thinks Siddall sucks and the letter was “divisive… never should have been sent…”

The criticisms are stinging, deep, bitter, even hostile. “Industry leaders confiding in me today,” says McLister, “were united on two fronts: that Mr. Siddall has lost their trust with such reckless assertions, and by virtue of that, has now officially overstayed his welcome in the Canadian mortgage market.” Ouch.

The mortgage dudes argue CMHC dropped the ball for consumers by not helping create more inventory to shelter middle-class buyers, by coming up with a stress test imposing too-high a bar on borrowers and restricted economic activity and by forcing more people into the rental market, goosing costs. It’s CMHC’s own fault, the industry says, if the agency’s market share has fallen from 90% a few years ago to 40% now and more and more borrowers are forced into the arms of private, more lenient insurers. Finally, Siddall and his bearish view of real estate is undermining confidence in our financial system, driving off investors and their capital.

And this: “Siddall’s constant unfounded charges that the industry facilitates “excessive borrowing” paints lenders and insurers as profit-hungry robber barons who couldn’t care less about doing the right thing for the country. That’s not the most endearing or effective management style.”

Well, not everybody can be on the winning side of this dust-up.

Either residential real estate is partying like it’s 2017 for valid reasons (pent-up demand, cheap money, low listings) or we’re headed for a come-to-Jesus reckoning (pandemic, recession, job loss). Sales have literally exploded, from Vancouver Island, to the Lower Mainland, through the Okanagan, in southern Ontario, the GTA, Ottawa, Montreal, Halifax and even sleepy little Lunenburg where listings that sat for a year now sell in a day to people who viewed them online. The current trends are obvious. Dirt, not condos. Space and privacy. Social distance. Doors that open onto streets. Small over big. And lower-priced places to live since you can now Zoom anywhere.

In the midst of the worst times since the 1930s, the buying seems bottomless. Intuitive. Evan Siddall cannot understand. But then, he is a rational man.

157 comments ↓

#1 tbone on 08.13.20 at 3:14 pm

I might take advantage of a discounted property if the
right one comes up .
I dont mind taking a haircut on my own property to upgrade .
The delta would be in my favour as i would be buying a more expensive property .

#2 Crazy Times on 08.13.20 at 3:19 pm

Crazy times, houses in my sleepy town are flying off the shelf. What use to sit for half a year, sellS within days. Not sure where all the money is coming from. I’m still not back at work because of Covid and my industry/ job isn’t looking like it’s making a comeback anytime soon. My last CERB cheque already cashed, am I the only one without an income? Business around my sleepy town hurting bad. The only thing moving is real estate. I cannot understand it. I’m just so thankful that I own my house. Everyone seems to be living on hope and fairy dust, recklessly spending outrageous prices in my sleepy town.

#3 Faron on 08.13.20 at 3:20 pm

When does the “be greedy when others are fearful” credo come into play with condos, or will it at all? It was a big bubble with lots of room to fall, but like stonks, the buy point isn’t going to be obvious.

Also curious how the wealth effect is playing into the RE frenzy at the moment. If it is strong, then the crossing of the deferral cliff (if coupled with newfound sanity in equities as yields pick up) could be a factor in an eventual housing correction.

#4 by on 08.13.20 at 3:21 pm

Garth what will the Fed do with the COVID work from home hitting 6 months soon? Is everyone getting at T2200? How does that affect the cap gains exemption for primary residence?

#5 Mattl on 08.13.20 at 3:23 pm

On the surface, this makes no sense. We’re in recession. Unemployment’s 13%. There’s a global pandemic. The government’s broke. Whole industries are decimated. Immigration has ceased. There may be another virus wave coming. Everybody has stuff on their faces and fear in their veins. Where did all this house-buying-at-any-price bravado come from, combined with the stunning risk of securing property you’ve never actually seen?

——————————————————-

Same place the confidence in the markets is coming from. All those things are happening and the SP 500 is close to all time highs.

Art, collectibles, auto’s, boat’s, RV’s are all selling like hotcakes at new highs. None of it makes any sense to me. Until you consider that money is free and gov’t is propping up industry. When this thing pops it is going to be spectacular. That’s if the gov’t lets it pop. Recent history says they will keep spending.

#6 Michael Trump on 08.13.20 at 3:24 pm

First!

#7 Squire on 08.13.20 at 3:24 pm

1st !

Everyone has lots their minds. No one even knows how to handle covid anymore either. Lockdowns, no lockdowns, masks, school. It’s all a mess.
Here’s hoping autumn isn’t a disaster…

#8 Speeding Train on 08.13.20 at 3:27 pm

This real estate market is like a speeding train, nothing seems to stop it. I don’t understand what Canadians are doing? Who are buying all these houses and why? Can the prices just keep going up indefinitely? We make a good income, but even we would struggle at today’s prices. The bank must be handing out money recklessly. I think there is low inventory because if you sell, where the heck do you go that’s economical. Heck even the boonies have sky high prices. I’d love to cash out but unless I move into literally the middle of nowhere, I don’t think I’d be farther ahead.

#9 tccontrarian on 08.13.20 at 3:27 pm

“Siddall’s constant unfounded charges that the industry facilitates “excessive borrowing” paints lenders and insurers as profit-hungry robber barons who couldn’t care less about doing the right thing for the country. That’s not the most endearing or effective management style.”
—————

And here I thought Siddall was being quite gentle in his letter!

But we shouldn’t expect the RE cartel to lay down and admit the ‘truth’, now do we?

Time will tell who’s right of course. My $$ on Siddall.

tcc

#10 FreeBird on 08.13.20 at 3:30 pm

$999,999 will get you this tiny 2 BR 1 bath ‘rare’ gem in Little Italy (Toronto not Italia). Looks like a shed but that’s just my non worldly taste.

https://www.google.ca/amp/s/beta.ctvnews.ca/local/toronto/2020/7/27/1_5040276.html

#11 Don Guillermo on 08.13.20 at 3:30 pm

Hence this slick video of a house on our street. I posted it before but more relevant to todays topic.

https://youtu.be/tbwoigNVeKU

#12 kingston boy on 08.13.20 at 3:33 pm

as long as interest rates are at all time lows, housing prices will continue to be at all time highs.

#13 Inequity on 08.13.20 at 3:33 pm

Getting the banks to lend responsibly is easy… quit covering their risk with taxpayer dollars.

#14 Sue on 08.13.20 at 3:34 pm

Nothing makes sense anymore. Stock market, housing,economy, our government.
Evan Siddal has common sense. Rare, like super rare these days..

#15 Coho on 08.13.20 at 3:36 pm

When numbers, equations, graphs, spreadsheets and accepted “rational behaviour” cannot explain current trends then seemingly irrational behaviour indicates other hidden things are at play…one being Programming.

Programming by media and more importantly much more sophisticated and powerful programming from other sources is influencing behaviour and keeping this runaway train world economy going. The new and inventive ways to support the Frankenstein-like global financial system is akin to the situation of a heroin addict. Either kick or it won’t end well resulting either jail, or perishing.

#16 The Woosh on 08.13.20 at 3:37 pm

You said a while ago we’d be surprised at how many people have squirreled away a good chunk of change to invest. I believe that’s true and now they’re using it buy these properties. There’s job loss but based on the traffic I see during rush hour, I don’t think the unemployment levels are as bad as they seem. I think this house buying trend isn’t short term…it’s going to go on for a long time.

#17 Decel on 08.13.20 at 3:41 pm

I don’t understand why the BoC lowered reference rates today. Won’t that help spur the FOMO? Isn’t it counterintuitive to their general message that was aligned with the CMHC? Weren’t they on the same side on this issue?

Bank posted mortgage rates fell and they determine the benchmark rate for the BoC. — Garth

#18 TurnerNation on 08.13.20 at 3:42 pm

Keep an eye on the food supply. They are ramping up the hysteria and steps.
(Apparently a goal of the New System is government control over food supply.)
Why not, a farmer controls the feeding, breeding and movement of his animals. So too are we cattle to our global rulers. Borders are closed. Young people scared out of dating. Need I go on?

Posted here many times past two years that people will go hungry in the future, as armed government men will destroy perfectly good food stuffs as they watch.

1. As if – this is nonsensical: And what about all the chemicals and pesticides in our food. Not a peep about that.

https://www.ctvnews.ca/health/coronavirus/chinese-officials-say-chicken-wings-imported-from-brazil-tested-positive-for-coronavirus-1.5062531

2. Slow steps to government control over food. Yep CV can do that. The article sounds decent. How could this be bad? Once you realize everything in the New System has been turned against us…we ain’t getting nothing for free no more.

“OTTAWA — More than 12 million eggs will be redistributed via an emergency federal program designed to help farmers faced with too much food and nowhere to sell it due to the COVID-19 pandemic.
Agriculture Minister Marie-Claude Bibeau announced Thursday that the government has signed eight agreements worth nearly $50 million to help align the needs of food banks and other community groups with what farmers and producers can supply.”
https://www.ctvnews.ca/politics/chicken-eggs-both-go-first-as-feds-roll-out-covid-19-food-surplus-program-1.5062708

3. I made the mistake of looking at a telescreen. During Pro sports must commercials are selling the New AbNormal – the New System. We must be sold it. A global marketing campaign was launched in March – targeting the West People on Zoom, people 6 feet away; healthy people wearing masks – unable to prove their health and secure freedom; sick stuff on the telescreens.

#19 Evil Bill on 08.13.20 at 3:51 pm

#17 TurnerNation on 08.13.20 at 3:42 pm

Keep an eye on the food supply. They are ramping up the hysteria and steps.
….

Dude.. you need to get onto this one… Bill has joined the chemtrailers and started spraying us….

https://www.cnbc.com/2019/09/07/bill-gates-funded-solar-geoengineering-could-help-stop-global-warming.html

#20 willworkforpickles on 08.13.20 at 3:52 pm

“Evan Siddall cannot understand. But then, he is a rational man.”
Here’s one way of understanding – the greatest fools of all time today are delusional in their fear of missing out. Fear drives people to do irrational and reckless things like no other emotion can. Greed on the other hand drives the likes of those in opposition to Evan Siddall to say and do whatever it takes at levels of desperation well within the realm of insanity to keep greater fools in a perpetual state of fear driven madness and the delusional condition of fear of missing out (FOMO)

As the pool of greater fools starts to dwindle, rational people will have their day in the sun again…but for a short while.

#21 FreeBird on 08.13.20 at 3:54 pm

It’s not the lie that bothers me. It’s the insult to my intelligence that I find offensive. -Unknown

—————

OBFUSCATION

(Good word for 2020 and politics)

#22 Dirty Dan on 08.13.20 at 4:01 pm

Garth, what are your thoughts on annuities?

There is an investment element as well as an insurance element. Of course dying early you lose (really your relatives lose), but at the same time you can’t outlive your money.

I know you’re against reverse mortgages, for obvious reasons. But this is quite different. Any wisdom on this topic?

Never buy an annuity in a period of low rates.That would be now. – Garth

#23 cto on 08.13.20 at 4:02 pm

BOC monetizing debt!!!
Their crazy, mixed up distorted actions are turning debt into wealth!!!
that’s it,… plain and simple, and they believe its the only way to go forward .
They are literally turning debt into cash…If you can get it, you are rich!
Thats why people on here that say they are working have nothing, but there are those that are not working have everything…

#24 DaleFromCalgary on 08.13.20 at 4:04 pm

I’m told there is a recession in Cowtown but just try getting a contractor. A thunderstorm tore off the storm door on the back door of my 1950s bungalow. I couldn’t fix it because the outside frame was too rotten to hold the hinge screws.

I decided to replace the whole thing, both storm and main door. Called six contractors in middle July and left voicemails because none of them were picking up. These are major door and window contractors, not single tradesmen with a van. Not one of them ever returned my call.

Finally got a contractor with a real live person on the phone. They came out, made an estimate which I accepted, and told me they can’t do the job until second week of October. Tell me again that Calgary is in a recession.

Friend of mine was a computer techie with WestJet, got laid off. Now making the same money from home working as a videoconferencing consultant helping clients set up Zoom meetings. No recession here for those who know things.

Fast food counter staff made redundant, but janitorial staff making very good money. What recession?

This is why people are still buying houses in Calgary.

#25 Dirty Dan on 08.13.20 at 4:05 pm

> There’s a global pandemic. The government’s broke. Whole industries are decimated. Immigration has ceased. There may be another virus wave coming. Everybody has stuff on their faces..

That? That’s just egg… from getting duped into panicking for a virus that has a 99.8% survival rate (overall). A 99.98% survival rate for anyone under 30, and even much higher for anyone under 30 who is healthy.

#26 defeated on 08.13.20 at 4:05 pm

“Getting the banks to lend responsibly is easy… quit covering their risk with taxpayer dollars.”

Ding ding, we have a winner!

I’ve given up applying reason to the RE market. I fear the endless madness will regrettably continue. Nothing will stop this because, there is no accountability. The only ones that are left covering the debts are the savers. Being responsible will only mean it is you who are are going to pay for everyone else’s recklessness.

#27 Sonny on 08.13.20 at 4:09 pm

#13 Inequity on 08.13.20 at 3:33 pm
Getting the banks to lend responsibly is easy… quit covering their risk with taxpayer dollars.

BINGO!

#28 Mattl on 08.13.20 at 4:11 pm

#12 kingston boy on 08.13.20 at 3:33 pm
as long as interest rates are at all time lows, housing prices will continue to be at all time highs.

———————————————

Not sure why this is so hard for people to understand. You can borrow 700K for under 3K @ 1.95%.

#29 willworkforpickles on 08.13.20 at 4:23 pm

FOMO FOMO FOMO – more and more FOMO. The cabbage patch garden variety fools are soaked with fear daily from pumpers pumping fear into their heads.

#30 T on 08.13.20 at 4:23 pm

Maskers, anti maskers, conspiracy believers, scientists, teachers, parents, politicians, advisors, gold nuts.

Where this goes no one knows. One thing is for sure, everyone believes they’re experts and has an opinion.

It will be interesting to see who is correct as time passes.

#31 Billy Buoy on 08.13.20 at 4:24 pm

Don’t worry..the Central Banks will save anyone…

After all in this day and age, no one is responsible for their actions.

Printer go Brrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrr.

If zombie corps can do it and lead by example, why not everyone else?

What a world.

#32 Inequity on 08.13.20 at 4:24 pm

#26 defeated

“Easy” was tongue in cheek… Taking away from the Sheeple would be difficult for even for the most popular and financially responsible party (The combination of is not common in Canada).

#33 Suburban Bob on 08.13.20 at 4:26 pm

Garth you forgot –

LOCATION! LOCATION! LOCATION!

Isn’t that all that robots need to sell to other robots?

#34 Dolce Vita on 08.13.20 at 4:32 pm

It’s the market share loss.

Other insurers willing take on risk. So be it.

Goes one of 2 ways, the risks Garth described happen, then watch the Cdn AIG’s in the making default and RE with them (Siddall has the last laugh) or COVID-19 disappears (vaccine and/or it’s infected all it can and no more) then RE game on as usual in Canada.

I think there will be a 3rd way.

Mother Nature and her 2nd wave.

France and Greece a few days ago declared just that (of course you would not know from 3 monkey Cdn MSM).

If so, it’s been nice knowing some of you.

—————————-

PS: for Cdns speaking on behalf of Swedes yesterday, let the Swedes speak on their own behalf, they may know a thing or two more about their COVID-19 performance than Cdns:

“Just 45% of Swedes now have confidence in the government’s ability to handle the pandemic, according to a Novus survey last month, down from 63% in April.” -24 July 2020, BBC.

I imagine that it’s even lower now. The above survey was taken before their 2nd Qtr -8.6% GDP growth rate, worst in 40 years announcement.

#35 Joe on 08.13.20 at 4:33 pm

Garth, i can’t understand something… a starter detach in vancouver costs $1.6M… if condos are not selling, how do ppl buy the detached, in the past, most detached buyers were move up buyers.

#36 Piano_Man87 on 08.13.20 at 4:35 pm

Friend is a lawyer here in Saskatoon. She was let go just before Covid, as she moved from her private practice to work for a bank. The bank screwed her over and punted her just before the 3 month mark. No CERB for her.

Her squeeze lives with her, and operates cranes for a living. Reduced hours cause of the virus.

BF is very hands on, so he’s killed the free time by completely updating their backyard. New patio, box planters, fireplace, etc.

Lawyer finally befriended her neighbour of 10 years, and bought a sweet luxury custom ornate Mexican sink she picked up while on vacation. (She bought two, and only installed one). So now they are going to redo their bathroom.

But – “what else are they going to do?” – That is their logic. Meanwhile, they are two people reduced from 2 to 1/2 an income.

In a near 100 year old creaky house with mold growing behind the wooden siding in the basement.

Remember in 2008 when gas was so expensive, people were abandoning their cars on freeways in the USA and just walking home? There is something about “home” when the future looks uncertain and frightful.

#37 Smartalox on 08.13.20 at 4:36 pm

@ #18 TurnerNation:

The ‘New System’ has been around in Montreal since 1948. Great Chicken!

https://www.newsystembbq.com/

#38 Tom on 08.13.20 at 4:37 pm

Unemployment’s 13%

———-

Also false. According to Stats Can, July unemployment across Canada was 10.9%. Again, not rosy but why exaggerate when the facts are already bad enough?

Toronto is 13.6%. – Garth

#39 YouKnowWho on 08.13.20 at 4:44 pm

Yeah, go ahead…rush to spend $2M on a SFH. GO!

Buddy rents a nice place in a building. Minto managed – very clean and tidy. 350 units – which by today’s condo standards is a cozy unit count.

He walks down the hallway, gets some steps in by going out the stairs. He rarely runs into anyone.

My building is very similar.

I know, avoiding those few flights of stairs is totally worth $2M.

Hmmm..when I cough from my balcony, does it skip the $2m house below? Or the one 100 meters away? :-)

My goodness, it’s true. Ice can be sold to eskimos.

What’s next? People will believe there is a shortage of land and space in the 2nd largest country on the planet?

#40 Ponzius Pilatus on 08.13.20 at 4:50 pm

I scrape in the morning, I scrape in the evening, all over this land.

Bytor, was that you?

https://theprovince.com/news/canada/man-charged-with-mischief-after-seen-peeling-off-stickers-in-a-viral-video/wcm/f08b9bc4-17b0-4373-a3be-3757618e3820I

#41 Bobby Duchene on 08.13.20 at 4:53 pm

What about the photo? Is that US NAVY SEAL? You should read “No Ordinary Dog”, it’s about a US NAVY SEAL and his dog who was on the bin Laden raid. Great book about a great dog.

#42 Brian Ripley on 08.13.20 at 4:55 pm

Wilding in Central Canada

My Canadian Housing Price Plunge-O-Meter with July data for Vancouver Calgary Edmonton Toronto Ottawa & Montreal is up:

http://www.chpc.biz/plunge-o-meter.html

Ottawa and Montreal SF Detached prices are up to new highs and Toronto pries are only 5% below their March 2017 SFD peak

#43 Smartalox on 08.13.20 at 4:55 pm

I do have to say that I resemble this post as my family and I are looking to decamp from Vancouver to a less expensive jurisdiction, now that everyone can work remotely.

We want to be safer, out of a too-small condo facing a heavy special assessment that will force our landlord to raise our rent (kept low for a decade) to more than we’d want to pay for the place, even if the membranes didn’t leak.

We’ve done some initial shopping online, but also have engaged an agent, and have had a few zoom visits. Working with an experienced agent is vital, as he knows to check (on Zoom) if the deck has soft planks, whether the furnace is due for replacement, or what the seller paid when our agent sold the property a dozen years before.

Now that we have seen some favourites, we’re going to visit in person.

And yeah, we’ll probably make a purchase, for less than half of what the banks will approve for us, pay with 20% down from our savings / investments, but well within the ‘Rule of 90’, with a mortgage less than 2.5 times salary, and a mortgage payment less than 15% of disposable income.

The only hard part is trying to do the math to see if taking a 10yr fixed for a few extra points is worth it compared to the 5 year variable.

Particularly if we’re not maxing out the down payment: I feel like with rates so cheap, it’d be better to keep as much money as we can in our investment accounts – that I will gain more from the returns than I would save on interest if we added that same $ to the down payment.

#44 Bill on 08.13.20 at 4:56 pm

DELETED

#45 Just be happy on 08.13.20 at 4:57 pm

At first, I was seriously mad Socks was handing out money to all those that shouldn’t have got it. After all, many/most of us dogs were prudent – we saved and planned for rainy days/months.

I have since come out of the closet to realize this thundershower of free money has helped stock markets return. I have forgone a few thousand in Socks dollars for many 10s of thousands in my portfolio. It could be much worse.

Let these greaterfools bid up the housing and spend their CERB, yes?!

#46 Boomer Bill on 08.13.20 at 4:57 pm

Some news on the Toronto Real Estate Front. Estate sale, my better half’s folks, listed a week ago, offers held off for a week and then all came through in one evening. Best offer with zero conditions, $560k above asking….
On the highway observation front, while on my afternoon jog, the QEW heading into downtown Toronto is back to being bumper to bumper like the preCovid days.

#47 Linda on 08.13.20 at 4:57 pm

Mr. Siddall’s comments clearly hit a nerve. That having been said, the people purchasing property are not being forced to make that purchase by the banks or mortgage firms. So any higher level of debt than they can service is IMHO the responsibility of the purchaser. When one shops, does the store inquire as to your ability to pay for that purchase? No. As long as the card works or the correct amount of cash is handed over, off you trot with your purchase. The fact you shouldn’t have bought it in the first place because you are mired in debt isn’t the responsibility of the shop.

Are those whose finances are less than stellar likely to lose their shirts when the balloon pops? Absolutely. Fingers will be pointed, government intervention will be demanded, blame will be flung about like beads during Mardi Gras. Bottom line though is that unless the purchaser is proven to be mentally incompetent to handle their own affairs the only one to blame is the person looking back at you in the mirror.

#48 Dolce Vita on 08.13.20 at 4:57 pm

About that 2nd wave that France and Greece announced the other day, at first I thought more politics than reality.

Then I saw this, oddly by CTV News (nicely done, not one of the 3 monkeys after all – so proud of them that I retweeted it to Deutsche Welle that gave it no coverage):

“German coronavirus tests backlog: 900 positive not yet told”

As an Italian (Germans well aware of the pass time) I tease them unmercifully BUT when it comes to COVID-19 discipline, ther Germans are 2nd to NOBODY.

If they cannot keep up tracing, heaven help the rest of us (we do not do phone or web tracing like in Canada, we actually come to your home w/911 personnel just in case).

Having said that Italia doing well despite body traffickers and the NGO Ferry Lines have resumed service from N. Africa to our embattled Lampedusa (as in the new cases map below, the Italian number includes at least 100 infected “Migrants” at last count per Italian MSM [both sides and in between of the political spectrum], growing by the day)…

This new cases European Map as of this morning, plus a few other non-European countries thrown in:

https://i.imgur.com/ZRgTK3s.jpg

Why I think France and Greece may be on to something here. It’s been like this 2 weeks now, at least. They are not just flare-ups from the 1st wave in my view, something else is afoot.

In the meantime be careful Canada.

If not and France and Greece are correct, Siddall will indeed have the last laugh.

#49 crossbordershopper on 08.13.20 at 4:58 pm

there is going to be a total cocoon effect moving forward. my 14 year old daughter doesn’t leaver her room unless its to the washroom or the fridge.
just have the internet on 24/7. I don’t even know if she knows we have a back yard? Then again she doesn’t care.
Personally Im happy being a home, not doing anything, and I like most people if having enough to pay the bills granted then they would stay home.
I talk to her about stocks, and her comment is ‘I don’t care’ because well, she doesn’t have to care. I look after it.
so, the conclusion is, no one is responsible, just live your life, if someone gives you a mortgage and eventually you cant pay it back so be it.
if our dollar goes down or purchasing power evaporates, back to my 14 year old, they don’t care.
yes we all know we shouldn’t give first time buyers 10 to 20 x leverage for a house, with sketchy jobs and futures, but well what are we going to do, have them live in our basement forever or in my daughters room in my case.

#50 Howard on 08.13.20 at 4:58 pm

https://www.ctvnews.ca/politics/we-charity-laying-off-staff-looking-to-sell-real-estate-in-toronto-1.5062841

WE Charity laying off staff, looking to sell real estate in Toronto

#51 Boomer Bill on 08.13.20 at 5:03 pm

#42 Smartalox on 08.13.20 at 4:55 pm

Particularly if we’re not maxing out the down payment: I feel like with rates so cheap, it’d be better to keep as much money as we can in our investment accounts – that I will gain more from the returns than I would save on interest if we added that same $ to the down payment.
———————————————————–

Of course you should keep your funds working for you when you can borrow for under 2%. Even the crappiest portfolio will give you more than 2%. I have averaged well over 10% for a decade and am up this year big time because I scooped up 20,000 shares in Barrick when they tanked in March and dumped them when they hit $40.

#52 Millennial 1%er on 08.13.20 at 5:09 pm

#46 Linda on 08.13.20 at 4:57 pm
>the only one to blame is the person looking back at you in the mirror

Except the responsible buyers are punished due to higher demand fueled by dumb people. The lenders are pushing the market up by allowing people to qualify who shouldn’t be.

#53 Md on 08.13.20 at 5:10 pm

Either Canadians are the stupidest people on the planet, or there is something I’m just not getting.

#54 cramar on 08.13.20 at 5:20 pm

#41 Bobby Duchene on 08.13.20 at 4:53 pm

What about the photo? Is that US NAVY SEAL? You should read “No Ordinary Dog”, it’s about a US NAVY SEAL and his dog who was on the bin Laden raid. Great book about a great dog.

———–

Thanks! Got the book on reserve from the library. They should make a movie about this with main star . . . a dog! With all the dog lovers in North America, lots of people would want to see it.

#55 crowdedelevatorfartz on 08.13.20 at 5:37 pm

@#231 Sue
“But seriously,
Its time we set the bar a little higher”

+++++

Careful we’d have to provide a stool and a phone book for Chrystia Freeland to sit on so she doesnt feel left out?

#56 Canadian Moose on 08.13.20 at 5:40 pm

Yup no one can agree on anything about ‘these days of the pandemic” Wife selling her Moms 2009 Corolla CE with 80000km’s. It was in nice shape. Asking $7500. Posted it on Facebook and lo and behold, 10 mins later her cell phone blew up. 20 mins after that people were lined up outside to view it. Are you kidding me? Got full price in cash for it. Gobsmacked and dumbfounded.

Never in my time have I seen this before. Yup, weird times….lol

#57 TurnerNation on 08.13.20 at 5:46 pm

Travelling: I know a half dozen people booking and raging to travel via Air – to way down south and overseas.
Two returned from Calgary, Vancouver recently too.

#58 Bytor the Snow Dog on 08.13.20 at 5:47 pm

Wind down the CMHC and let the mortgage insurance market go 100% private.

Then you’ll really see these Real Estate Agents and Mortgage Brokers whine.

#59 Sail Away on 08.13.20 at 5:55 pm

#24 DaleFromCalgary on 08.13.20 at 4:04 pm

I’m told there is a recession in Cowtown but just try getting a contractor. A thunderstorm tore off the storm door on the back door of my 1950s bungalow. I couldn’t fix it because the outside frame was too rotten to hold the hinge screws.

I decided to replace the whole thing, both storm and main door. Called six contractors in middle July and left voicemails because none of them were picking up. These are major door and window contractors, not single tradesmen with a van. Not one of them ever returned my call.

—————–

In the amount of time needed to coordinate contractors and be frustrated, why not just replace the door yourself?

Growing up on the farm, we learned early that if things go sideways, you need to be capable of doing anything and everything. There’s an added bonus, too- forever after, you get the satisfaction of using your work.

#60 Axy140 on 08.13.20 at 6:02 pm

It’s all about interest rates. When people see they can afford the payments they automatically think they can afford something regardless the price. For example, when people shop for cars these days they look at the monthly payments. People don’t bother negotiating prices anymore as if they don’t matter.

#61 the Jaguar on 08.13.20 at 6:05 pm

You don’t serve as the President,CEO & Director of a company serving more the 16 million customers with 1.3 trillion dollars in assets for more than 13 years unless you are able to read the tea leaves, so Gord Nixon’s thoughts on the real estate market are not to be taken lightly. He’s also an Aquarius, and they have life and other insights regular peeps go begging for….

Garth writes ‘..Where did all this house-buying-at-any-price bravado come from, ..?’ Sadly from the deepest depths of pure stupidity. Harsh as it may sound, many of the financial decisions people make are borne out of impulse, desire for immediate gratification, and with no thoughtful consideration of the facts in front, behind or ahead of them. When chickens get in the mood for serious roosting they always go straight to where these types of people live. Mercy.

Covid is also not just a virus. It’s an extremely powerful accelerant. Telecommuting was already becoming a trend, same with consolidation of bricks and mortar in financial services, store front retail was already under serious assault with many closures over the years, and travel services like hotels and airlines were already beginning to eat their young due to over supply and AirBnB competition. Virus arrives and acts as an immediate accelerant to all those trends. As for housing, anybody who was thinking about leaving the mega- cities due to disquieting trends such as crime, drug use, homelessness, public urination, needles, etc., may have decided not to wait any longer.
If people like Evan Siddall are correct and real estate values are likely to go down the smart money will get out now. Exit stage left before the mob suckers realize there is a freight train bearing down on them.

Speaking of my hero Evan Siddall, Garth I am sending you a nicer photo of him which I hope you will use in future blog posts. He needs to look his best given the bright future ahead of him.

#62 Leftover on 08.13.20 at 6:10 pm

It’s all about interest rates. Once the bond market gets stingier about CAD, which could happen sooner than you think, then look out.

In the meantime, others are worried too.

UK:

https://moneyweek.com/investments/property/601606/house-prices-crash-uk-property-prices-falling-where-next

Australia:

https://www.theguardian.com/australia-news/2020/mar/20/australian-housing-market-will-hit-the-wall-in-coronavirus-recession-experts-say

Though less so in the USA where they have done a better job reigning in household debt:

https://www.economist.com/finance-and-economics/2020/07/02/americas-housing-market-is-so-far-unfazed-by-recession

#63 Drew on 08.13.20 at 6:10 pm

I have a friend who is dead set on buying a house as soon as they can. They have some money but not GTA money, but they can’t stop thinking about it. I’m having friendly conversations with her about it being a pandemic, you don’t have a job, wait til CERB ends, etc.
I still can’t believe people think that this is a good time to buy a house!

#64 Penny Henny on 08.13.20 at 6:11 pm

#10 FreeBird on 08.13.20 at 3:30 pm
$999,999 will get you this tiny 2 BR 1 bath ‘rare’ gem in Little Italy (Toronto not Italia). Looks like a shed but that’s just my non worldly taste.

https://www.google.ca/amp/s/beta.ctvnews.ca/local/toronto/2020/7/27/1_5040276.html
////////////////

That hut sold in the tail end of 2016 for $$$1,218,000.
Currently listed as a conditional sale.
I wonder what the condition is?

#65 Dolce Vita on 08.13.20 at 6:11 pm

About this French, Greek 2nd Wave theory.

Doubting Thomas, slow on the uptake me, remembered he can go to the John Hopkins COVID-19 page and look at the Daily Cases histogram and determine if France and Greece are correct. Based on that hypothesis, the following are the results:

DEFINITE 2nd Wave Candidates
————————————–

France, Greece, Spain, Belgium, Romania, Netherlands, Poland, Serbia, Czech Republic, Denmark, Bulgaria, Slovenia, Lithuania, Croatia, Iceland (well if a peak of 20 is that, then so be it…looks like a 2nd wave).

On the CUSP of a 2nd Wave?
———————————-

Germany, Sweden, UK, Switzerland, Norway.

Still keeping it DOWN
————————–

Italia, Portugal, Ireland, Austria, Finland, Hungary.

Of course the above just looking at the shape of the Daily Cases histogram (some of it reductio ad absurdum e.g., Iceland).

Well, well, well…looks like France and Greece the ONLY “have their proverbial [dung] together” nations when it come to calling the 2nd Wave…as for the rest of the 2nd Wave European nations…”What they don’t know won’t hurt them” seems to the theme du jour.

Welcome to Planet Earth.

Welcome to Humanity and its Foibles.

Welcome to the Little Pandemic that Could, and Does (like the Cdn. economy).

————–

PS:

ERIC SIDDALL, you sooth sayer you.

#66 Been like ... on 08.13.20 at 6:13 pm

this out here in 604 for going on seems like forever. As long as you don’t go back too far. No end in sight … until there is of course. Every so often …

#67 Bytor the Snow Dog on 08.13.20 at 6:19 pm

@ 140 Ponzie the Transparent:

No Dear, that isn’t me. I have a more effective means of protest. I spend zero dollars at any business that requires you wear a mask to enter. That said, I have always been friends with a couple of local merchants who understand that in our area there are mandatory mask requirements but that there are exemptions. They accept my assertion that I have a medical exemption. Thus, they have an “out” if a Karen or the Covid Police show up.

Otherwise, it’s all online from Amazon or the like.

Other businesses who buy the into hysteria got woke so they can go broke.

Hahahaha!

More to come. Resistance is NOT futile. I’s got wayyyy more to tell. Soon.

#68 dogwhistle on 08.13.20 at 6:27 pm

#13 Inequity on 08.13.20 at 3:33 pm

Getting the banks to lend responsibly is easy… quit covering their risk with taxpayer dollars.

Nice to see an intelligent comment on this blog, really a pleasant change. So many things are “protected” in this country it’s farcical. Hide’s the low productivity, and being 5 years late on everything compared to other countries. lol

#69 You know val on 08.13.20 at 6:38 pm

BIS RULES

#70 IHCTD9 on 08.13.20 at 6:39 pm

#46 Boomer Bill on 08.13.20 at 4:57 pm
Some news on the Toronto Real Estate Front. Estate sale, my better half’s folks, listed a week ago, offers held off for a week and then all came through in one evening. Best offer with zero conditions, $560k above asking…
—- —-

Were they asking 560k below market?

You know how this game is played. The gta realtors figured out long ago all you need to do is stoke up some fomo, get all the trembling nervous wrecks together, and watch them saw off their kidneys and staple them to their offers.

That’s the gta on CV-19 and 2% 5’ers

#71 Gweilo on 08.13.20 at 6:44 pm

In San Francisco paper today. SF condo inventory spikes, with price reductions skyrocketing. Interesting article in SFGATE online.

https://www.sfgate.com/ontheblock/slideshow/Condo-inventory-spikes-with-price-reductions-206546.php

#72 Penny Henny on 08.13.20 at 6:48 pm

#45 Just be happy on 08.13.20 at 4:57 pm
At first, I was seriously mad Socks was handing out money to all those that shouldn’t have got it. After all, many/most of us dogs were prudent – we saved and planned for rainy days/months.

I have since come out of the closet to realize this thundershower of free money has helped stock markets return. I have forgone a few thousand in Socks dollars for many 10s of thousands in my portfolio. It could be much worse.
////////////////

I recently came to the same conclusion.
In fact I may have benefited 10-30 times more than any CERB recipient

#73 Nottawa Housing Bust on 08.13.20 at 6:51 pm

How long can the BoC reasonably purchase mortgage and federal debt. If this continue for the next year that will be an extra 100 billion to national debt.

At what point do you just say they will never pay it back. And at that point don’t the bonds become essentially worthless. The province of Ontario just announced a 40 billion deficit.

How do we balance that? Tell people to start businesses so we can shut them down again and force bankruptcy. Will we make cuts to educ or health care (God help the person who suggests this, they will be eviscerated in MSM).

NOBODY AND I MEAN NOBODY is talking about economic recovery. Only about how well the markets (housing and stock) are doing. Nobody is talking to individuals who lost their jobs, lost their business, is facing mounting debt etc.

It seems like the narrative is shut everything down, COVOD will kill us all. But “essential workers” can still go to work, i need my double double, bag 9f groceries and bottle of booze. CERB for all and big debt big spending is OK. Don’t worry about a thing, cause someone else will fix it.

Its like the world has taking shrooms and is just enjoying the trip. It will worry about finding its clothes, and the way home later… when it sobers up. Strange times.

Oh yeah…. whatever happend to the immenent climate crisis? I am pretty sure that problem is still there.

#74 Paul on 08.13.20 at 6:51 pm

#53 Md on 08.13.20 at 5:10 pm
Either Canadians are the stupidest people on the planet, or there is something I’m just not getting.
————————————————————————————————
Haha, Canadians lock the country down for months maybe years force the population to wear masks. Spend 350 Billions we don’t have. Pay 8.5 million people not to work elect a Prime Minister with nice hair crazy socks and larceny in his heart. Yes stupidity!

#75 Sara on 08.13.20 at 6:55 pm

Houses are the new toilet paper.

#76 Nonplused on 08.13.20 at 6:55 pm

It would be interesting to see how much impact the CERB and more specifically mortgage deferrals are doing to restrict listings. After all, why list when you can squat? Especially since the alternate is living in a tent under a bridge because all the apartments are already being squatted in by the “Keep Your Rent” crowd who also aren’t being evicted.

It seems to make sense to me, in a perverse way. You gotta do what you gotta do. Folks who normally would have listed or maybe got a roommate for financial reasons are taking advantage of covid to live for free. And their alternative might be homelessness if they sold. They are stuck between a rock and a hard place. Better to kick the can down the road as long as you can. Advice: get a nice tent with your CERB before Canadian Tire is all sold out of those too. Or, if you have equity in your house, execute the “California Strategy” of buying an RV so when they take your house you can sleep in the Walmart parking lot.

This is a sort of mess I don’t see an easy way out of. Sooner or later the foreclosures and evictions will resume, but there will be so many of them that it could take years to sort it all out. There will be many a tear shed. This is the sort of thing that causes revolutions. Although what we will revolt to I am not sure since we are pretty much a socialist country already. Maybe a final reversion of all housing to state ownership?

————————–

As for the CMHC losing market share, well good. I don’t want my tax dollars backing that nonsense anyway. The big banks are big enough to do their own calculations and charge their own premiums, they don’t need some mysterious government entity telling them who to lend to and who not. CMHC is on the face of it, just another socialist intrusion into markets that work just fine without it. And tagging everyone with a 5% insurance premium and essentially adding it to the mortgage isn’t really helping anyone. Why can’t the banks self-insure? In the old days they just charged a higher rate for high risk borrowers and insisted on higher down-payments. But no, the government had to come in and “fix” things with another colossal bureaucracy and unfunded liability. And did they make housing more affordable? Almost certainly not. They just padded the bank accounts of the home builders and bankers. “Making things affordable” usually means “lending money to people who can’t really afford to borrow it”.

#77 Penny Henny on 08.13.20 at 6:57 pm

53 Md on 08.13.20 at 5:10 pm
Either Canadians are the stupidest people on the planet, or there is something I’m just not getting.
//////////////////

Are you Canadian?
Answer Yes, then you are even stoopider.

Answer No, then you just don’t get it

#78 mark on 08.13.20 at 7:01 pm

Rob McLister sounds like the name of a realtor in a porno.

#79 Deplorable Dude on 08.13.20 at 7:17 pm

Well locally here everyone is freaking out over BC’s exponentially rising Covid case count.

However…..

…..hospitalizations are flat….our hospitals don’t have any C19 patients to speak of. And we’re more than 2 weeks into the ‘2nd wave’, so should have started seeing hospital cases rise by now.

Is this herd immunity we are building thru the younger less at risk generation being infected?

I hope so.

#80 ImGonnaBeSick on 08.13.20 at 7:17 pm

#22 Dirty Dan on 08.13.20 at 4:01 pm
Garth, what are your thoughts on annuities?

There is an investment element as well as an insurance element. Of course dying early you lose (really your relatives lose), but at the same time you can’t outlive your money.

I know you’re against reverse mortgages, for obvious reasons. But this is quite different. Any wisdom on this topic?

Never buy an annuity in a period of low rates.That would be now. – Garth

—–

I posted about annuities a couple days ago when talking about defined benefit pensions. Some people were posting that their DB would pay them ~17g/yr and I was very surprised since that’s very close to what a 250,000 annuity will also pay. I had assumed a 20-30 year career with DB would have been more than what an annuity would pay.

The issue is this; at this rate, it would take around 16 years to just recoup the 250,000 annuity cost. You could just withdraw the 6% from 250,000 you saved up and you have a very good chance of retaining most of the original capital. Which, at 81, you could then blow on a Hunter S Thompson style Las Vegas trip, complete with Johnny Depp’s heir shooting your remains from a canon at the end of it.

#81 Nonplused on 08.13.20 at 7:20 pm

I made this a separate comment so it could be deleted without taking out the previous comment.

Some interesting questions on the origin of covid:

https://www.zerohedge.com/medical/andrew-kimbrell-origins-covid-19

To summarize, why did covid-19 start in Wuhan where there are 2 biological labs playing with these things and not in the towns (well, cities in Canada) 1,900 miles away where the bats live?

Why can they not find covid-19 in nature, not even in the bats?

Why does the covid-19 have 2 genetic characteristics not found in other covid viruses, but are found in other pathogens?

Why did the governments around the world crap their pants? What did they know? Why were they so afraid?

All conspiracy theory I know but it seems to me the proposition that this virus was man-made and escaped a research lab cannot be ruled out, however unlikely. I don’t know that that changes anything though. We still have to (hopefully) live through it.

And remember, when T1 (Terminator, the movie) came out, AI and autonomous killing machines were science fiction. Today we have drones, SkyNet is basically a thing and Russia has one too but neither system has gone rogue yet, and autonomous robots are a thing. They don’t look anything like Arnold Schwarzenegger but they are a thing. Life imitates art. It’s 1984 all over again.

#82 akashic record on 08.13.20 at 7:31 pm

Woke societies: debt jubilee.

It helps that the level of global debt is beyond comprehension, the unbreakable trend is up. Everybody knows it can never be eliminated in any other way, unless classic slavery gets reinvented. It won’t – just like America can’t be “discovered” again.

#83 Stone on 08.13.20 at 7:34 pm

#4 by on 08.13.20 at 3:21 pm
Garth what will the Fed do with the COVID work from home hitting 6 months soon? Is everyone getting at T2200? How does that affect the cap gains exemption for primary residence?

———

From personal experience, employers don’t want to sign the T2200. The HR and Legal departments are in a tizzy as they believe it will impact the employer’s ability to deduct occupancy costs on their end as well as stationary costs.

Sounds more like head office bureaucrats trying everything to say no but who knows, maybe there’s a legit reason.

Sad that they’re being so cheap.

#84 SeeB on 08.13.20 at 7:34 pm

It seems counter intuitive that housing continues to go up in price despite the employment and debt stats, but anecdotally speaking, the number of comments I hear from people I know personally, and what we see here in the comments about vultching properties, I really shouldn’t be surprised. It’s possible that the pent-up demand Garth has been speak of the last few months may run much deeper than we realize. It’s starting to feel like it’d take crash at least 3 times worse than 2008 to even make a dent in the Great Canadian Property Dogma.

#85 tccontrarian on 08.13.20 at 7:43 pm

#65 Dolce Vita on 08.13.20 at 6:11 pm

About this French, Greek 2nd Wave theory.

———————————————

Hey El Duce – stop spreading your fear! I don’t have the link, but it was estimated that 50-75% of people who died of CV would have died in 2020 anyway!

And if you’re pro contact-tracing well, you’re not so smart. Perhaps you should stop scrolling past TurnerNation’s posts because there enough evidence to suggest he may be correct in his assessment.

Do you also wear a mask while typing your posts?

tcc

#86 Stone on 08.13.20 at 7:45 pm

#38 Tom on 08.13.20 at 4:37 pm
Unemployment’s 13%

———-

Also false. According to Stats Can, July unemployment across Canada was 10.9%. Again, not rosy but why exaggerate when the facts are already bad enough?

Toronto is 13.6%. – Garth

———

Account for CERB and the Toronto unemployment rate is Currently -13.6%. That’s right. Minus.

You’ll need to wait until EI is done before the real reckoning commences.

#87 Winterpeg on 08.13.20 at 7:52 pm

Who are the private insurers of mortgages that are taking market share from CMHC?
Who underwrites the private insurers if their customers default? Won’t be the tax payer.

#88 mike from mtl on 08.13.20 at 7:54 pm

#83 Stone on 08.13.20 at 7:34 pm

From personal experience, employers don’t want to sign the T2200. The HR and Legal departments are in a tizzy as they believe it will impact the employer’s ability to deduct occupancy costs on their end as well as stationary costs.
//////////////////////////////////////////////////////////////////

Same, early on my HR dept flat out said no, because it is a temporary measure. I imagine they would not be able to write off many expenses and liability would then open up. Especially in corporate structures where high cost locales are used to shift losses and expenses towards.

#89 MM on 08.13.20 at 7:55 pm

If the CMHC is so worried about the speculation
in the residential real estate market then they
should just not insure mortgages anymore and
let the private sector blow their brains out
if that’s what their position is on the situation.
Walk your talk as they say.
Hypocrites.

#90 steve schmelzle on 08.13.20 at 7:58 pm

housing costs and values are inflated for the same reason the stock market is inflated.

but investment in one inflated opportunity is considered sound, while the other isn’t.

strange.

Among other reasons, stocks are not bought with 20x leverage by people who can muster only 5% down.

#91 Drake Turner on 08.13.20 at 8:00 pm

It was always dirt, Garth.

Listen: this housing market is more robust than the spring of 2017. 10…20…30 offers on properties. No conditions. No cool down time. I just wrote a file yesterday that saw a 142% increase in house value in 4.5 years. No driveway. Needs work.

Supply vs Demand.

Low supply and people flush with cash.

#92 45north on 08.13.20 at 8:02 pm

Yesterday we featured rebel Evan Siddall on this pathetic blog. The head of CMHC accused other mortgage insurers of pandering to high-risk households, fomenting excessive debt and setting up Canadian real estate for a painful fall. Prices, he said, could be 20% lower by the end of the year because of joblessness, recession, Covid, the end of CERB and the coming deferral cliff. Siddall described the ‘dark underbelly’ of the market, and did so in a stark, historic, three-page letter to his competitors, the industry and the nation at large. The stir was palpable.

good on Evan Siddall! At least there is one person saying what he thinks.

#93 Ace Goodheart on 08.13.20 at 8:02 pm

Garth, if you have any influence over the people in charge (I do not) there is one pressing issue in real estate sales that is screaming for regulation:

The blind auction.

This has to stop.

People should not have to participate in an auction, where all other bids are kept secret, in order to buy a house.

We need an open bidding process.

This needs fixing.

#94 Cto on 08.13.20 at 8:11 pm

One thing we can count on ,….the Bank of Canada and their friends Within the debt industry to throw Evan under the bus , the big one with the dual wheels…
Then throw it into reverse to ensure a proper job well done.
Then they need to find a friendly puppet.
Maybe that Sheer guy…

#95 Left Vancouver on 08.13.20 at 8:15 pm

I thought I made a mistake buying just before COVID exploded.

Looking back – thank god.

Up 150k in the first 6 months of this year on the BC property outside of Vancouver. Big payout. My whole career has been a complete failure but the golden parachute of real estate wealth saved me from being a working slave and having to report to someone and show up in person at some workplace at a certain time defined by what they call the “employer.”

Lower mainland sucks. Fraser Valley is full of COVID. And who aspires to live on a big farm field? No wonder COVID is raging there. Sorry Surrey, Langley, Abby and Chilliwack. Nothing exciting there.

Love having the landscapped yard fully irrigated. Newer build. Fully finished. Sweet neighborhood. In Vancouver I had to use a sprinkler, manually. The house was old and falling over. Screw that.

400k line of credit that you think I really need? Nope. But guess how much that is making me in a balanced diversified portfolio? That is right. Enough to retire before 40.

God bless BC real estate outside of Vancouver. Living the dream.

Get out and explore BC people.

Also, for any broke people wanting to settle in BC, check out the Kootenays. You can still do it on a living wage if you have not stacked it like me. Innovate. Start you own business.

#96 Do the Opposite on 08.13.20 at 8:22 pm

They said no, don’t buy real estate. Okay. Up four fold.

They said run, the stock market will crash and never return. Yeah, uh huh.

They said, go to school, spend 100k and get a good 9-5 job. You know, the ones that have disappeared. Okay.

They said, don’t be dreaming about creating your own destiny. You will end up at McDonald’s for the rest of your life. Sure okay.

When you stay atop the media and the theme calls for something do the exact opposite.

When CNBC says huge crash – load up. When they say, the market is hot – sell.

When Evan Siddall, BOC or any other talking head says, STOP, don’t buy real estate it is going to crash- buy anything you can get your hands on.

When short sellers scream, Tesla is nuts. Buy it up.

When they say gold is going to crash. Back up the truck.

Cut through the noise and look at the real data.

There are real reasons for everything. The person making the money is lying to you.

#97 IHCTD9 on 08.13.20 at 8:28 pm

#59 Sail Away on 08.13.20 at 5:55 pm
#24 DaleFromCalgary on 08.13.20 at 4:04 pm

I’m told there is a recession in Cowtown but just try getting a contractor. A thunderstorm tore off the storm door on the back door of my 1950s bungalow. I couldn’t fix it because the outside frame was too rotten to hold the hinge screws.

I decided to replace the whole thing, both storm and main door. Called six contractors in middle July and left voicemails because none of them were picking up. These are major door and window contractors, not single tradesmen with a van. Not one of them ever returned my call.

—————–

In the amount of time needed to coordinate contractors and be frustrated, why not just replace the door yourself?

Growing up on the farm, we learned early that if things go sideways, you need to be capable of doing anything and everything. There’s an added bonus, too- forever after, you get the satisfaction of using your work.
— –

Most pre hung doors come with installation instructions, and youtube will walk you through it step by step.

I threw a new pre-hung exterior door on our back room because the moulding and jamb were rotting. This door faced east and was shaded from the south – it was damp all the time. Piece of cake, didn’t even need youtube. Put a composite moulding on there too because it was the first to rot on the old door.

500.00 bucks, done in a day. That includes the unfortunate requirement of having to take all the siding off the wall too because the new moulding was a lot wider than the old one.

I have a BIL who hired out 3 door re+re’s, very nice doors. He didn’t have to lift a finger, but – 6 grand. That’s a good used Grizzly 700! Not happening!

#98 Nonplused on 08.13.20 at 8:31 pm

“Among other reasons, stocks are not bought with 20x leverage by people who can muster only 5% down.” – Garth

True. But it is amazing how fast a margin account can let you double down on Tesla or Nortel or RIM or Bre-X if the price is going up. Of course when the price starts going down you get stopped out pretty quickly and if you read the terms and conditions they can take all the money you have even if it was their fault you didn’t get stopped out soon enough, so be careful. Margin, or debt basically, is no way to gamble. Whether houses or stocks.

#99 Linda on 08.13.20 at 8:37 pm

#52 ‘Millennial’ – responsible buyers may be ‘punished’ by the insane FOMO real estate buying spree, but being responsible they won’t succumb to it either. IF they do choose to engage ‘because everyone else is doing it and we won’t get a place otherwise’, that isn’t being ‘responsible’. That is justifying why they took on a debt load that they realistically could not service. Does it suck to be shut out of the market? Indeed it does. It would however be far more sucky if one is mired in debt one can not realistically repay.

#100 april on 08.13.20 at 8:41 pm

Check out My Realty Check, for the LowerMainland BC – August – almost all red arrows.

#101 Comrade on 08.13.20 at 8:53 pm

I give up. If global pandemic and this level of unemployment didn’t make a dent in Canadian real estate nothing will.

I’m going to forget about all this fiscal responsibility I have been practicing. Go get the biggest mortgage I could possibly get. Plug the nose and jump in. I really don’t understand it anymore. But it seems it has been working for many.

#102 Nonplused on 08.13.20 at 8:54 pm

#95 Left Vancouver on 08.13.20 at 8:15 pm

“Also, for any broke people wanting to settle in BC, check out the Kootenays. You can still do it on a living wage if you have not stacked it like me. Innovate. Start you own business.”

————————

The Kootenays are beautiful with all kinds of recreation, hunting, fishing, etc. but no sane person would buy property there until BC divides along the coastal mountains. The new territory would not necessarily have to join Alberta, but seperate from Victoria and Vancouver they must be. I’d probably put the new provincial government in Golden, but there are a bunch of other locations that would work. Maybe Kamloops. Or maybe Cranbrook. But anyway BC is about to split as is Oregon. The “inlands” can’t stand the “coasters”. It is much worse than the divide between Edmonton and the rest of Alberta.

#103 Mr Canada on 08.13.20 at 9:01 pm

Sounds like the critics of Mr Siddall’s have a financial interest to perpetuate the status quo….

#104 Still not loving police on 08.13.20 at 9:09 pm

Nah Garth, that is a talking point on the TV bro.

House prices are going up.

#105 Cto on 08.13.20 at 9:10 pm

95 Left Vancouver

“thought I made a mistake buying just before COVID exploded.”

My young friend….

I thought I made a mistake buying in TO in 2011….wronge!

This is the insane world/reality we get to enjoy brought to you by financial elites at our central banks….
They have distorted everything,….indefinetly… .
And thay will take at some point.

#106 Boomer Bill on 08.13.20 at 9:23 pm

#70 IHCTD9 on 08.13.20 at 6:39 pm
#46 Boomer Bill on 08.13.20 at 4:57 pm
Some news on the Toronto Real Estate Front. Estate sale, my better half’s folks, listed a week ago, offers held off for a week and then all came through in one evening. Best offer with zero conditions, $560k above asking…
—- —-

Were they asking 560k below market?

You know how this game is played. The gta realtors figured out long ago all you need to do is stoke up some fomo, get all the trembling nervous wrecks together, and watch them saw off their kidneys and staple them to their offers.

That’s the gta on CV-19 and 2% 5’ers
————————————————————

The lower price is a ploy used by realtors but in reality, eveyone who is going to be a serious buyer of the home knows the real market price give or take 100k. So what transpires is you get some low ball offers just above the asking price by people who think the seller has lost their marbles or are desperate and then the serious buyers bid what the home is worth.It went about $100k above what I thought it was worth. We are talking almost $2 million…

#107 I drive a spaceship on 08.13.20 at 9:24 pm

Siddall has been reading too much Saretsky twitter.

Once, you read too many of those tweets them become convincing. You start drinking the kool-aid as if it makes so much rationale sense.

All marketing and mirrors. Tormorrow, the real estate market is going to crash. I promise.

Meanwhile Saretsky is buying up Vancouver properties.

Priceless.

Learn the game people.

#108 Cto on 08.13.20 at 9:29 pm

debt.
Its all govrrnment backed.

#109 Boomer Bill on 08.13.20 at 9:42 pm

#93 Ace Goodheart on 08.13.20 at 8:02 pm
Garth, if you have any influence over the people in charge (I do not) there is one pressing issue in real estate sales that is screaming for regulation:

The blind auction.

This has to stop.

People should not have to participate in an auction, where all other bids are kept secret, in order to buy a house.

We need an open biby, a dding process.

This needs fixing.
————————————————————-

You mean like in Australia Ace?

https://www.thestar.com/business/2017/05/02/could-open-auctions-make-torontos-real-estate-market-more-fair.html

#110 R on 08.13.20 at 9:43 pm

I would vote for any party Mark Carney was the leader of. Nothing less then PM. He is the only guy I could trust, other than Garth Turner. Now that would be a win/ win. Mark Carney PM, Garth Turner FM.

#111 Doug in London on 08.13.20 at 9:45 pm

Wow, that’s quite a picture! It’s something I can relate to, having jumped many times myself. I’m reminded of a video I saw of a skydiver, in freefall, with a small dog strapped in the harness with him. This dog’s fur was blowing all over the place and looked at the camera as if to say: Wow, I don’t know what to make of this experience!

Now with the comic relief out of the way back to more serious business. Buying a house off the internet, ARE YOU NUTS?

#112 Guelph Guru on 08.13.20 at 10:03 pm

My friends, it’s different this time. As savers I have been the greater fool.

I’ve been told that the only option Govt has is to devaluate the dollar to Jap Yen levels. Wait a min you would say, but Real Estate did crash in Japan right, some time in 1990s. And what about the lost decade after that? Oh but that’s so past, we are in 2020 and the economic pundits buying real estate in Canada know their stuff.

Our dear Justin will soon announce another round of CERB. And another. And another. There will be plenty of $s everywhere. Why bother about paying back, those are just numbers in cyberspace and some people give away real goods for them. Anyway, it’s the next PMs problem.

It would definitely be different this time.

#113 TurnerNation on 08.13.20 at 10:06 pm

#19 Evil Bill yeah it’s been floating out there that they might salt the earth. Heard that years ago.
Already Monstanto has a lock on seeds, patents; of course their stuff will grow anywhere. For a price.

Same old same old, nothing changes:

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

#114 Drinking on 08.13.20 at 10:07 pm

#24 DaleFromCalgary

Yep you get it; I start work at 5:30 a.m. and traffic is flowing, that is my barometer, never mind these so called stats that people are throwing out there; not you Garth, different hockey game!

#115 IHCTD9 on 08.13.20 at 10:18 pm

#106 Boomer Bill on 08.13.20 at 9:23 pm
#70 IHCTD9 on 08.13.20 at 6:39 pm
#46 Boomer Bill on 08.13.20 at 4:57 pm
Some news on the Toronto Real Estate Front. Estate sale, my better half’s folks, listed a week ago, offers held off for a week and then all came through in one evening. Best offer with zero conditions, $560k above asking…
—- —-

Were they asking 560k below market?

You know how this game is played. The gta realtors figured out long ago all you need to do is stoke up some fomo, get all the trembling nervous wrecks together, and watch them saw off their kidneys and staple them to their offers.

That’s the gta on CV-19 and 2% 5’ers
————————————————————

The lower price is a ploy used by realtors but in reality, eveyone who is going to be a serious buyer of the home knows the real market price give or take 100k. So what transpires is you get some low ball offers just above the asking price by people who think the seller has lost their marbles or are desperate and then the serious buyers bid what the home is worth.It went about $100k above what I thought it was worth. We are talking almost $2 million…
——

Yeah, but they get a great fomo producing headline out of it don’t they? I’m with Ace on these blind auctions.

I’d like to form a group of a few thousand folks and split them up into groups of 50. Each group would have fake ID’s, contact info, and fake cheques. I’d send them around via public transportation to fake bid on all these properties. Low, high, all over the place. Shake on the deal, and then disappear into the woodwork. Then send a different group back for round two!

#116 A Yahoo on 08.13.20 at 10:33 pm

CMHC is basically hoax management. The hoax is: the non existent ‘risk’, because it is unproven, and Siddall will never even attempt to explain the risk because he cant. He just repeats the word at every opportunity
Does anyone buy the credit card insurance ? Of course not, And those loans are unsecured.
CMHC was, is and will remain a garden variety fraud.
If you buy into insurance on secure loans, you will buy into insurance on the insurance too.

#117 KNOW IT ALL on 08.13.20 at 11:10 pm

The things GROWN ADULTS will say and even do when you trash their way of living….. even when it’s unethical and immoral to the well-being of their own blood.

#118 Karlhungus on 08.13.20 at 11:12 pm

Prices rising everywhere, except Edmonton. Prices will never rise in Edmonton again.

#119 haitao wan on 08.13.20 at 11:24 pm

i read greater fool since 2009.
If anybody believe what garth said, the only result will be sad, he will lose a lot money in real estate or he will lose big chance to take same property in much lower price.
The price of real estate in whole Canada is booming month by month from 2000! like crazy, i am happy to have 80+ apartments in Montreal, enjoy it very much!

#120 Ace Goodheart on 08.13.20 at 11:34 pm

Looks like the lockdowns are coming to an end.

They’re just going to make everyone wear masks.

Watch your news feed in the next week or so. It is going to come out that the virus spreads by droplets, which can be pretty much eliminated if the spreader is wearing a face mask.

Masks: they do nothing for you, but they protect everyone else.

This should cause entertainment industry stocks to pop up pretty quick. Everything can open up again.

#121 the Jaguar on 08.14.20 at 12:30 am

@#102 Nonplused on 08.13.20 at 8:54 pm re:
The “inlands” can’t stand the “coasters”. It is much worse than the divide between Edmonton and the rest of Alberta.

It’s funny the way we tend to attach identity to provinces without drilling down further to see what lies within. The ‘Edmonton’ versus rest of Alberta is probably something only Albertans would understand.
Edmonton is a government town, lots of secure jobs as a result, less of an entrepreneurial spirit, lots of pigs feeding at the trough. Rumour has it that in the early days when the vote came in for which city would be named ‘the Capital’ it was pretty much even. Edmonton said ‘Give it to us and we’ll build the first University in Calgary’. They went back on their word and mistrust was born. These days no serious person thinks about them as any serious rival as Calgary out classes them in every way, though they do have world class medical research programs. Otherwise they are a sort of ‘ugly cousin’.

As for the Regional District of East Kootenay it’s only a matter of time before we annex those lands and redraw the border. I figure we take a page out of Putin’s book when he brought Crimea back into the bosom of Mother Russia. Or maybe that’s just the romantic in me…..

#122 SoggyShorts on 08.14.20 at 12:44 am

#36 Piano_Man87 on 08.13.20 at 4:35 pm
Friend is a lawyer here in Saskatoon. She was let go just before Covid, as she moved from her private practice to work for a bank. The bank screwed her over and punted her just before the 3 month mark. No CERB for her.

***************************
Why no CERB for her?

#123 jane24 on 08.14.20 at 1:53 am

Britain is following the same path. No-one now wants to buy a city apartment, everyone wants suburbs or small towns you can zoom from, bigger back gardens and space to work from home. Friends in Australia say exactly the same thing is happening there. Used cars are hot as no-one wants to take the bus any more. Anyone silly enough to have an investment condo needs to get it on the market now. Shared space is not coming back. Covid 20 and 21 will make sure of that.

#124 Two-thirds on 08.14.20 at 1:56 am

This buying epidemic is a stress response brought about by the pandemic. People are scared and thinking that this may be their last chance to:

1) Get the house of their dreams
2) Buy that fancy car
3) Etc…

So now, in addition to stress-eating, we are stress-shopping, and spending like there is no tomorrow, because, well, there might not be one, right?

Moi, spending it all before the taxman comes. We all will pay for the bottomless government spending, whether by taxation or inflation, so exchanging my dollars for hard assets that can hold value, provide fun and mental relief, and cannot be easily confiscated is how I intend to give the finger to the powers to be!

The irresponsible get bailed out, the prudent and savers get to pay for it all. If you cannot beat ’em, join ’em.

Thanks T2 for making moral hazard government policy.

#125 Trimalchio on 08.14.20 at 3:27 am

A bunch of highly levered wannabes posing as nouveau riche is your answer

#126 trimalchio on 08.14.20 at 3:35 am

#78 mark on 08.13.20 at 7:01 pm

Rob McLister sounds like the name of a realtor in a porno.”

Rob McBlister would have more of a porno ring to it.

#127 Stan Brooks on 08.14.20 at 4:56 am

Self serving cartel parasites with zero integrity and intellect.

The fact that such incompetent, uneducated ‘experts’ determine the financial stability of a nation is disturbing. But hey, after all this is just a herd of sheep, who deserve their shepherds.

As for the confidence in the ‘financial system’ it is fantastic, great, considering the state or the affairs.
It is precisely zero, soon to turn negative.

I won’t trust these idiots with a used condom.

Cheers,

#128 Stan Brooks on 08.14.20 at 5:01 am

#105 Cto on 08.13.20 at 9:10 pm
95 Left Vancouver

“thought I made a mistake buying just before COVID exploded.”

My young friend….

I thought I made a mistake buying in TO in 2011….wronge!

This is the insane world/reality we get to enjoy brought to you by financial elites at our central banks….
They have distorted everything,….indefinetly… .
And thay will take at some point.

Yep, because there are idiots who play by the rules of the elites and as a result will soon be homeless, jobless with no kids, who exist just to pay the mortgage and the lucky few who have kids that will have no future.

Good luck in finding quality new immigrants to support this mental institution folks.

Cheers,

#129 Alan Greenspan on 08.14.20 at 6:20 am

#112 Guelph Guru on 08.13.20 at 10:03 pm
My friends, it’s different this time. As savers I have been the greater fool.

I’ve been told that the only option Govt has is to devaluate the dollar to Jap Yen levels. Wait a min you would say, but Real Estate did crash in Japan right, some time in 1990s. And what about the lost decade after that? Oh but that’s so past, we are in 2020 and the economic pundits buying real estate in Canada know their stuff.

Our dear Justin will soon announce another round of CERB. And another. And another. There will be plenty of $s everywhere.
————————————————————

You are correct and wrong. You are correct that savers have been the Greater Fools. Only those in real estate or financial instruments have made serious coin in the past decade. You and others seem to make a link between CERB money and real estate when there is none. CERB recipients are not buying real estate…

#130 Stan Brooks Psychiatrist on 08.14.20 at 6:26 am

#128 Stan Brooks on 08.14.20 at 5:01 am

Yep, because there are idiots who play by the rules of the elites and as a result will soon be homeless, jobless with no kids, who exist just to pay the mortgage and the lucky few who have kids that will have no future.

Good luck in finding quality new immigrants to support this mental institution folks.
—————————————————————-

Ah Stanley, you poor soul both literally and figuratively.
You also give yourself away with all your mental institution talk. Now put away the keyboard, take your meds to forget that you are a broke boomer while some boomers have more money than they know what to do with. You are such a sad sack Stanley… it must suck to be you.

#131 Captain Uppa on 08.14.20 at 8:14 am

#63 Drew on 08.13.20 at 6:10 pm
I have a friend who is dead set on buying a house as soon as they can. They have some money but not GTA money, but they can’t stop thinking about it. I’m having friendly conversations with her about it being a pandemic, you don’t have a job, wait til CERB ends, etc.
I still can’t believe people think that this is a good time to buy a house!

————————————-

Ditto for my workplace.

All the twenty-somethings are on websites like Zolo all the time. The thirty-somethings are all plotting their road to riches via multiple home purchases – most through condos (yikes).

It’s a frenzy, alright.

Funny though, the gold people have gone quiet.

#132 Captain Uppa on 08.14.20 at 8:17 am

I am fascinated by the emptying of major city cores and suburban influx.

Manhattan is seeing record vacancies.

Link: https://www.cnbc.com/2020/08/13/empty-apartments-in-manhattan-reach-record-high-topping-13000.html

#133 crowdedelevatorfartz on 08.14.20 at 8:32 am

@#132 Capt Up
“Manhattan is seeing record vacancies.”
++++

Two things.
They have only been collecting vacancy stats for 14 years?
2 bedroom rentals in Madhatten is $4650.00/month….

#134 JB CONDO DEATH on 08.14.20 at 9:06 am

The current trends are obvious. Dirt, not condos. Space and privacy. Social distance. Doors that open onto streets. Small over big. And lower-priced places to live since you can now Zoom anywhere.
…………………………………………………………..
#123 jane24 on 08.14.20 at 1:53 am

Britain is following the same path. No-one now wants to buy a city apartment, everyone wants suburbs or small towns you can zoom from, bigger back gardens and space to work from home. Friends in Australia say exactly the same thing is happening there. Used cars are hot as no-one wants to take the bus any more. Anyone silly enough to have an investment condo needs to get it on the market now. Shared space is not coming back. Covid 20 and 21 will make sure of that.
………………………………………………………………….
The NO CONDO trend is setting up like cement now. CONDOS are out as living spaces due to the high risk of COVID. CONDOS are for investment purposes as the rental market is crashing. The only places people want now SFH’s, Semis & towns. Anybody thinking of purchasing a CONDO had better give their head a shake. Your pouring your hard earned cash into a toilet. Buy now and pay high only to see your investment shrink in the following years. Fees will definitely go up as the boards will have to enforce COVID distance spacing and cleaning. Guess who gets to pay for that? Insurance is another matter.

#135 Do we have all the facts on 08.14.20 at 9:18 am

In June the Parliamentary Budget Officer released an very interesting summary of wealth distribution in Canada as a background to the possibility of increasing the share of taxes imposed on the wealthy.

The net worth of 15,940,000 Canadian households in 2019 was estimated at $11.7 trillion.

Financial assets. $7.5 trillion
Real estate. $5.7 trillion
Consumer durables. $0.7 trillion

Less Mortgage debt. $1.5 trillion
Consumer debt. $0.7 trillion

Total net worth $11.7 trillion

This total was broken down as follows

Top. 1.0%. 159,300 households $3.01 trillion
Top 10.0%. 1,593,500 households. $6.63. trillion
Top 20.0%. 3,187,000 households. $8.63. trillion
Middle. 40.0%. 6,374,000 households. $2.93. trillion
Bottom 40.0%. 6,374,000 households $0.126 trillion

This indicates that the average net worth of the bottom 40 % of all Canadian households is less than $20,000. This average has been supported by a number of studies indicating that millions of Canadian households have less than $3,000 in savings.

A 5.0% down payment on a $400,000 dwelling would require $20,000 plus closing costs. When you consider that 10,840,000 (68%) Canadian households already own their home it seems very probable that the number of households who might qualify for a mortgage to purchase a home at current price levels and under current mortgage guidelines is declining every day.

CMHC is well aware of the income levels of potential first time home buyers across Canada and is concerned that the fear of missing out on low interest rates might result in many new homeowners exposing themselves to financial hardship in the future.

Once again I must point out that the bottom 40% of all households in Canada hold only 1.1% of the net wealth held by all households. This is not a statistic that supports the continued escalation of house prices across Canada.

after the deduction of mortgage and consumer debt of

This

#136 45north on 08.14.20 at 9:29 am

fake news

National Post has an article by Marcus Parekh
Trump’s hair woes put pressure on showers

it’s in the paper version but it’s not on their site because it’s not their most brilliant piece of journalism

so why is it fake? The article reports on real people and what they said. Including is the statement Under a 1992 law enacted by George H.W. Bush, shower heads in America are limited to allow 2.5 gallons of water through every minute. – doesn’t sound fake at all

but it’s fake because the National Post is trading on its position as a newspaper – newspapers are considered an impartial and trusted source of relevant information. We rely on the newspaper to sift through myriad facts and stories to present the most relevant. So the National Post has passed over the fact that crime in major cities in the US is up dramatically and there are riots and looting. So the National Post has passed over the most relevant information to present the least relevant. Motivation is to present Donald Trump in a poor light. It’s fake because it’s not impartial and it’s not relevant.

#137 Dharma Bum on 08.14.20 at 10:03 am

#63 Drew

I still can’t believe people think that this is a good time to buy a house!
——————————————————————–

There’s no time like the present!

In 10-12 years from now (which will fly by like an instant), all the homeowners who got in at 2% will be sitting pretty.

Unless, of course, they go bankrupt.

In Canada, if you ain’t got a house, you ain’t nobody.

People view you with disdain and contempt. That’s why people crave houses at the risk of financial ruin. It’s all about social status, appearances, optics, illusion, and creating a fake (usually unaffordable) persona.

Same goes for cars. Ever wonder why you see a preponderance of BMWs, Mercedes, Audis, Bentleys, Ferraris, Porches, etc., like you’ve never seen before?

Money. Is. Free.

No consequences in Canada.

Buddy next door will foot the bill when you default.

In the meantime, live it up.

#138 mike on 08.14.20 at 10:15 am

For long 20 years, I have heard real estate will go down and nothing. I am happy has not happened however what’s happening has not logic. Canada is the only country in the world with this behaviour. Are we naive, should we just accept this reality? Experts are not experts any more, they just are right after the facts.

#139 Sail Away on 08.14.20 at 10:55 am

From CBC:

“Ottawa police launched a hate crime investigation on Monday after a man screamed obscenities outside McKenna’s Catherine Street constituency office last week.”

*********

Oh boy. Would it have been better if he just spoke obscenities instead of screaming?

If the thought police ever read the disparaging things said about T2 on this blog, there’ll be trouble!

#140 The West on 08.14.20 at 10:58 am

The Landed Gentry blather on about theory.

What’s going to happen when the CERB ends?

#141 Tom from Mississauga on 08.14.20 at 11:22 am

Certainly in support of the coming inflation reach/fork lift operators in Mississauga pay has gone from $17-18 an hour to $20-21, 17% increase since February.

#142 Stoph on 08.14.20 at 11:32 am

#140 The West on 08.14.20 at 10:58 am
The Landed Gentry blather on about theory.

What’s going to happen when the CERB ends?
—————————————————————–

UBI begins.

https://globalnews.ca/news/7268759/manitoba-mp-submits-motion-to-convert-cerb-benefit-to-permanent-basic-income/

#143 Damifino on 08.14.20 at 11:38 am

#137 Dharma Bum

Ever wonder why you see a preponderance of BMWs, Mercedes, Audis, Bentleys, Ferraris, Porches, etc., like you’ve never seen before?
————————–

Yes! And don’t forget Aston Martin, Jaguar, Maserati & Tesla. There’s dealerships for all of them within a three block radius of 2nd & Burrard in Vancouver. Business is torrid and has been so for years. I can’t see much reason why it should slow down soon.

Like the building contractor who lives in my building recently told me: “there’s gobs of money flying around this city and it’s very anxious to be spent”.

Meanwhile, the squalid tent city in Strathcona Park grows bigger by the day and I’m hesitant to walk around downtown anymore. And it’s not because of Covid.

#144 Ace Goodheart on 08.14.20 at 1:22 pm

RE #115 IHCTD9 on 08.13.20 at 10:18 pm

The process for purchasing a house by way of a “blind auction” is nuts.

The argument made by realtors and their enablers (read, subprime lenders) is that a person has the “right” to sell their house any way they like, and forcing them to follow a process during the sale violates their freedoms and liberties.

This of course is a load of bull.

Canadians don’t have property rights. Government can regulate the sale of anything it wants. Look how stocks and bonds are sold if you want an example.

Here is how they do it in Australia:

https://www.cbc.ca/news/business/here-s-how-to-buy-a-home-in-australia-should-canada-follow-its-lead-1.3826727

In Ontario, if you want to purchase a house, and you are in a “hot” market (like Toronto), the process goes something like this:

1. Book a showing. The realtor will walk you around.

2. Have a look at the “price” listed. This is just a gimmick. The sellers have no intention of letting the house go for list price. This is just to get people to bid on the house. It is intentionally set low.

3. Have your bank prepare a certified cheque for $100,000 payable to the real estate brokerage. Bring it to “offer night”. Bring your Agent with you. You will be told that you have to “top off your bid” to account for your Agent’s 2.5% commission. This is not true, but they will do it anyway.

4. Make a “blind bid”. Offer as high over asking price as you are able to. Your offer has to be firm, with no conditions, or it will be refused. You will not be able to bid firm, because you don’t actually have anywhere near the purchase price in cash. So you will be putting yourself into severe legal jeopardy by making a firm bid. People get sued all the time for this. Buyers are being forced into agreeing to purchase homes with money they do not have. The buyer then hopes they can borrow enough, and sell their existing home for enough, that they can actually close. If not, it’s off to Court to see a Judge when the seller sues you.

5. Your bid will be refused. They always refuse the first round. You will not be told what anyone else has bid. The auction is fully blind. You are told go out, come up with a higher number, and then come back. So you up your bid, not knowing the bids of anyone else. For all you know, you may be the only bidder and the seller is just playing with you. You will never know how many bids, and where you were in the line.

6. If you are really, really, really lucky, the seller gets tired playing with all of the buyers, and chooses a winner. That person then has to scramble to beg, borrow (or sometimes steal) enough money to actually close for the ridiculous, record setting sale price. It’s time to hit up secondary lenders for hundreds of thousands necessary to bridge the gap between what you have, what you can borrow from your primary lender, and what you actually need.

Mothers, fathers, grandparents, uncles, aunts, anyone and everyone gets asked for a loan as the frantic “winner” tries to come up with millions of dollars in time to close the deal.

Often the buyer is also in the midst of selling their own home, so when they do that, with another “firm” offer made at another blind auction, to a person who also does not have enough money to close, the buyer then waits anxiously until closing date for their home (which is usually on the exact same date as closing date for the home they have “won” and are purchasing) to see if the buyer of their home can come up with the money.

When this whole ridiculous process falls apart, the law suits resulting are legendary. You sue the person who couldn’t close on your house, the person who sold you the house that you now cannot close on sues you. It is just amazing how bad these things can go wrong.

There is just no logical reason why houses have to be bought and sold like this. The process is incredibly harmful to buyers, and also puts sellers in a position where they often sell to people who cannot close.

Our real estate sales regime is in serious, screaming need of regulation. People are getting hurt by this process.

#145 Joe on 08.14.20 at 1:23 pm

Your blog could be made to question markets also. Why did everyone get so market lusty? With all the negative stuff going on you mentioned who’s buying ETFs stocks bonds etc.? The reason real estate is FOMO is same reason markets are FOMO. By now you must know they are both in the same boat. Knock one knock both.

Kids don’t buy stocks with 20x leverage and 5% down. Emotion breeds FOMO. – Garth

#146 Keyboard Smasher on 08.14.20 at 1:41 pm

>”Leading the resistance was veteran broker Rob McLister who detailed seven reasons he thinks Siddall sucks and the letter was “divisive… never should have been sent…”

What is with this “divisive” weasel accusation developed by the US Democrat propagandists and why is it used in this context even?

What they mean of course is that we do not accept the new dispensation of the gospel truth spread by the left. This automatically causes a division of opinion, this is clearly a very bad thing in their eyes.

#147 tkid on 08.14.20 at 1:42 pm

Listings in the leafy suburbs of Niagara Falls exploded recently, and hardly anything is not selling within 3 days of hitting realtor.ca if the prices are ‘reasonable’.

#148 Masks really do make some people more attractive on 08.14.20 at 2:06 pm

#139 Sail Away on 08.14.20 at 10:55 am
From CBC:

“Ottawa police launched a hate crime investigation on Monday after a man screamed obscenities outside McKenna’s Catherine Street constituency office last week.”

*********

Oh boy. Would it have been better if he just spoke obscenities instead of screaming?

If the thought police ever read the disparaging things said about T2 on this blog, there’ll be trouble!

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

Garth’s pretty quick to police over-the-line comments here. There’s no comparison between the gentle Trudeau bashing seen here with what women in public life receive. Unless you’re confusing the voices in your head with reality, again.

#149 kingston boy on 08.14.20 at 2:21 pm

@#147 tkid on 08.14.20 at 1:42 pm
Listings in the leafy suburbs of Niagara Falls exploded recently, and hardly anything is not selling within 3 days of hitting realtor.ca if the prices are ‘reasonable’.
——

5YR fixed mortgage rates under 2% will do that.

#150 kingston boy on 08.14.20 at 2:27 pm

@#144 Ace Goodheart on 08.14.20 at 1:22 pm
RE #115 IHCTD9 on 08.13.20 at 10:18 pm

The process for purchasing a house by way of a “blind auction” is nuts.

——–

I like what they do in Scotland.

1. seller sets price.

2. potential buyers place their bids,
whatever they may be.

3. as long as one of the bids has met or exeeded the
sellers set price the sellers have to accept.

#151 TurnerNation on 08.14.20 at 3:07 pm

FLOP perhaps down under is a test bed at this time, if this is a correct picture from New Zealand. From a supermarket chain. The veil has dropped:

https://pbs.twimg.com/media/EfTLDFEUYAEIp7f?format=jpg&name=900×900

#152 Cowtown_dream on 08.14.20 at 3:19 pm

#24 DaleFromCalgary

I’m told there is a recession in Cowtown but just try getting a contractor. A thunderstorm tore off the storm door on the back door of my 1950s bungalow. I couldn’t fix it because the outside frame was too rotten to hold the hinge screws.

I decided to replace the whole thing, both storm and main door. Called six contractors in middle July and left voicemails because none of them were picking up. These are major door and window contractors, not single tradesmen with a van. Not one of them ever returned my call.

Finally got a contractor with a real live person on the phone. They came out, made an estimate which I accepted, and told me they can’t do the job until second week of October. Tell me again that Calgary is in a recession.

Friend of mine was a computer techie with WestJet, got laid off. Now making the same money from home working as a videoconferencing consultant helping clients set up Zoom meetings. No recession here for those who know things.

Fast food counter staff made redundant, but janitorial staff making very good money. What recession?

This is why people are still buying houses in Calgary.

——————
Or…

The perfect storm:

-lots contractors on covid money kicking it back
-lots of folks with spare time, needing to feel useful hence they start renovating (end up hiring contractors)
-also lots of folks worried about the housing market, renovating so they can sell in a tough market

I think the house prices are the indication of whats actually happening in Cowtown. And if you have been watching, they are dropping…

Also lots of rentals on the market, with reduced prices…

Even with lots still working and being creative which is great, with 15% unemployment and more folks working part time with reduce salaries there will be less money flowing into real estate.

But your right people will always ‘still’ buy houses, they won’t stop completely.

#153 Sail Away on 08.14.20 at 3:33 pm

#148 Masks really do make some people more attractive on 08.14.20 at 2:06 pm
#139 Sail Away on 08.14.20 at 10:55 am
From CBC:

“Ottawa police launched a hate crime investigation on Monday after a man screamed obscenities outside McKenna’s Catherine Street constituency office last week.”

*********

Oh boy. Would it have been better if he just spoke obscenities instead of screaming?

If the thought police ever read the disparaging things said about T2 on this blog, there’ll be trouble!

————

Garth’s pretty quick to police over-the-line comments here. There’s no comparison between the gentle Trudeau bashing seen here with what women in public life receive. Unless you’re confusing the voices in your head with reality, again.

————

Hate crime? Really? Against who? I watched the video twice and, while vulgar, it’s a dangerous stretch to classify it as a crime.

Hey, here’s an idea: make any and all criticism of the government a hate crime.

#154 Masks really do make some people more attractive on 08.14.20 at 4:00 pm

#153 Sail Away on 08.14.20 at 3:33 pm

Oh boy. Would it have been better if he just spoke obscenities instead of screaming?

If the thought police ever read the disparaging things said about T2 on this blog, there’ll be trouble!

————

Garth’s pretty quick to police over-the-line comments here. There’s no comparison between the gentle Trudeau bashing seen here with what women in public life receive. Unless you’re confusing the voices in your head with reality, again.

————

Hate crime? Really? Against who? I watched the video twice and, while vulgar, it’s a dangerous stretch to classify it as a crime.

Hey, here’s an idea: make any and all criticism of the government a hate crime.

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

https://www.bbc.com/news/uk-37978582

That’s why.

#155 PetertheSeparatistfromCalgary on 08.14.20 at 4:03 pm

The last time we had to deal with this kind of public health crises was 1918. The world was a very different place back than and was just starting to recover from WWI.

That means we can’t use history to predict what happens next and makes most forecasts nothing more than a guess.

My guess is that asset prices will go up relative to the value of money and once we defeat COVID19 prices of everything else will follow.

Central Banks have basically devalued money by creating so much of it during this crises. Hopefully inflation rises by a manageable amount. Higher inflation if moderate is a good thing because inflation and interest being this close to zero makes it hard to counter the next recession with monetary policy.

Unfortunately, we cannot know for certain that inflation will be moderate and we could get 1970s type bad inflation. That required pretty extreme measure by Paul Volcker to stop. The high interest rates required to defeat high inflation contributed to a fiscal crises in Canada.

#156 Sail Away on 08.14.20 at 4:07 pm

#154 Masks really do make some people more attractive on 08.14.20 at 4:00 pm
#153 Sail Away on 08.14.20 at 3:33 pm

Hate crime? Really? Against who? I watched the video twice and, while vulgar, it’s a dangerous stretch to classify it as a crime.

Hey, here’s an idea: make any and all criticism of the government a hate crime.

————-

https://www.bbc.com/news/uk-37978582

That’s why.

————-

Bullshit. Big difference between swearing at someone and killing them.

You ever swear at anyone? If so, maybe it’s prison time, eh?

#157 Fabio on 08.17.20 at 12:15 pm

My condo is up 100% from when I bought it. Waterfront T.O. condo with a lake view. Bought a pre-construction 4 years ago and will move in next month. That one is up 40%. Same view
I have renters in my building asking me when I’m moving out so they can buy it sans real estate agent and pay my lawyer fees.
Love being contrarian to this blog. Made me some big bucks over the years.