Why they buy

This week the cowboy running our federal housing outfit raged on Twitter against a twit realtor. Well, to be fair, Owen Bigland actually has an outsized opinion of himself. The Vancouver agent has a blog, a book, a degree and boasts he’s been a successful life-long real estate investor. But that don’t impress Evan Siddall much.

So when Bigland tweeted this…

Many people miss the leverage factor in RE. Buy a condo for $500k with 10% down. 3 yrs later that condo has appreciated to $550k many look at it as a 10% return when it’s actually a 100% return. Leverage is how true wealth is built. You need to get your money working.

…Siddall fired back with this…

Sigh…Because in your made-up world, house prices only go up. This kind of investment advice is like selling penny stocks because they’re cheap/. You DO realize leverage works just as powerfully when prices go down… or were you not alive on 2008-9?

Ouch.

Well, the dude has a point. Realtors who pump real estate as a 100% speculative investment, and are careless about promoting 10x leverage deserve a reaming from time to time. Yes, property prices fluctuate (just like stocks), so when you buy using big piles of borrowed money, risk is seriously enhanced. A sane or prudent person would only do that when conditions were ideal.

And what are the current conditions? Let’s recap.

  • A global pandemic. 820,000 dead
  • No proven therapies or approved vaccine
  • Authorities bracing for a second wave
  • The worst  economic downturn since the 1930s
  • Structural unemployment
  • A crash in immigration
  • Closed borders
  • Millions surviving on government handouts
  • Hundreds of thousands deferring mortgage payments
  • Civil unrest and political instability for our major trading partner
  • Historic debt. Epic deficits. Austerity and taxes likely.

But you know what’s happening. So does Evan. Canadian real estate – especially in markets like Toronto, the 905, Ottawa, Montreal and the Lower Mainland – is hot stuff. Because there was no spring market (we were all going to die, remember?), demand was uncorked in the summer even as the economy tanked. Low mortgage rates and emotion have combined to create a property boom in the middle of a recession, even as the government scrambled to keep the lights on. Amazing.

Says a new report from LowestRates.ca: “The coming reality check could be a painful one. It’s very hard to say right now if the blistering house price gains we’ve seen in the past few months will continue into the autumn and winter season. That’s when the market will really be tested. The overall economy is continuing to struggle with elevated unemployment and businesses hesitant to spend. So far, hot housing markets like Toronto’s have shrugged this off, but there’s higher risk than normal now of that reversing.”

The immediate threats: the end of mortgage deferrals leading to a surge in listings. A 65% plop in immigration, sapping demand. The collapse in Airbnb combined with jobless renters causing the condo market to swamp. Double-digit unemployment stretching well into 2021. CERB ending and government support winding down since Ottawa’s out of cash. The virus. Still here. Maybe that next wave or lockdown.

Wow. Serious stuff. Why would people take on this level of risk or, as Owen Bigland suggests, leverage themselves up the wazoo to speculate?

As with most decisions, there are good reasons and stupid excuses.

Here are the rational, logical, practical factors behind the current housing melt-up:

  • Money’s cheap. More than that, it’s almost free. So why not borrow as much as possible to buy what I previously could not afford? I’ll never pay it off anyway, because I’m actually just renting a pile of dough. Life is short, brutish and they make you use Zoom. How is this a bad thing?
  • Where else am I going to invest? It’s all too scary. Besides I get to live there
  •  It worked for my parents.

But even more powerful are the emotional divers which have created a real estate boom in the midst of economic detritus. And, of all the emotions, fear rules.

  • The world is terrifying. I need to cocoon. The newscasts are full of sickness, infections, deaths, protests and people who are angry, succumbing or talking through masks. My family and I need to bubble. In our house.
  • The virus is terrifying. I want a safe environment. Why would I ride an elevator, walk a condo corridor, take the subway or even walk into the office again? My house is my world now, and it should be perfect.
  • The city is terrifying. I want space and safety. A front door on the street. Fresh air through the windows. A back yard and a front walkway. Distance from others. Maybe the burbs aren’t so bad.
  • FOMO. Sheesh, have you seen prices lately? If I don’t buy now I fear I’ll never be able to. Where do I sign, bro?

And up she goes. Of course when you buy something at an inflated price with money you have, risk is contained. When you borrow, it isn’t. For some, this may not end well.

 

172 comments ↓

#1 Overheardyou on 08.25.20 at 2:51 pm

This really makes one wonder, how much supply must increase to make a noticeable decline in demand and therefore prices? Are there any stats that could provide a valid estimate?

#2 T on 08.25.20 at 2:53 pm

And cue the ‘buy and hold for 5 – 10 years and you will make out like a bandit’ crowd.

As for Bigland, and the vast majority of realtors for that matter, they should be reprimanded for the misrepresentation of the numbers. Rarely do I see transaction and holding costs factored into their claims and projections.

#3 Mona on 08.25.20 at 2:58 pm

I stopped watching Mr. Bigland and that other guy Jay Coupar.

I like Jacky Kuk, Steve Saretsky and FORMAFIST (IS MY FAV).

My two cents!

#4 vancouver help on 08.25.20 at 3:00 pm

Hi Garth, So far we have a complete reversal of what happened in 08 and unemployment was only around 8 %.

I am not surprised as for 10 years we have had a whole generation hear nothing but my house price is always going up. Interest rates staying low and easy money to be made, sign here.

Do up a graph to show unemployment vs housing prices for 08 and now.

It boggles the mind.

#5 Doug t on 08.25.20 at 3:04 pm

Caveat Emptor

#6 YouKnowWho on 08.25.20 at 3:14 pm

O Canada!
Our homes on native land!
True love of debt in all of us commands.

With glowing hearts we see thee rise,
The one million dollar 10 foot wide semi!

From far and wide,
O Canada, we drown in debt for thee.

Queen owns our land, glorious and free!
O Canada, we drown in debt for thee.

O Canada, we drown in debt for thee.

#7 JB CONDO DEATH on 08.25.20 at 3:21 pm

The world is terrifying. I need to cocoon. The newscasts are full of sickness, infections, deaths, protests and people who are angry, succumbing or talking through masks. My family and I need to bubble. In our house.
The virus is terrifying. I want a safe environment. Why would I ride an elevator, walk a condo corridor, take the subway or even walk into the office again? My house is my world now, and it should be perfect.
The city is terrifying. I want space and safety. A front door on the street. Fresh air through the windows. A back yard and a front walkway. Distance from others. Maybe the burbs aren’t so bad.
FOMO. Sheesh, have you seen prices lately? If I don’t buy now I fear I’ll never be able to. Where do I sign, bro?

And up she goes. Of course when you buy something at an inflated price with money you have, risk is contained. When you borrow, it isn’t. For some, this may not end well.
…………………………………………………………………..
My wife had to visit another nurse at her condo yesterday and above were her exact thoughts as she walked into the lobby. She was fully masked and has surgical gloves, plus hand sanitizer. She sees this shit every day and came home shaking her head saying I never want to have to set foot in a condo or any other confined area until this pandemic is under control. She literally had a slight anxiety panic and she is a nurse, she deals with this every day. She said going into an environment where the safety protocols are not blasted all over the walls was a little terrifying. At the hospital we are fully geared up and trained for this. The people mulling in and out of the condo were only around 50/50 with masks. It was a WTF moment for her. Anyway her friend has it listed and wants to move to Mississauga into a town or semi.

#8 45north on 08.25.20 at 3:21 pm

The immediate threats: the end of mortgage deferrals leading to a surge in listings. A 65% plop in immigration, sapping demand. The collapse in Airbnb combined with jobless renters causing the condo market to swamp. Double-digit unemployment stretching well into 2021. CERB ending and government support winding down since Ottawa’s out of cash. The virus. Still here. Maybe that next wave or lockdown.

there’s a young family who just bought a house in the Glebe in Ottawa. I heard they also have a $800,000 condo in Toronto. This is a real estate play.

I guess there’s room in the basement if we have to take them in.

#9 SunShowers on 08.25.20 at 3:24 pm

Hahaha, Evan’s willingness to address Canadians in a direct and personal capacity makes me like him.

#10 CanadianGrizzly on 08.25.20 at 3:27 pm

RE: Aug 24 post ” If you get a honking big loan for 1.5%, you won’t be renewing it for the same price five years hence. No matter what President Harris or PM Freeland do.”.
Actually by 2025, the POTUS and Cdn PM will no longer exist. The USSA and Kanada will be post-national states run by UN Global Governance using a global digital UNcoin. That or the West will be engaged in a kinetic war with China. Hope your UBI covers the monthly on your honking big loan.

#11 FreeBird on 08.25.20 at 3:29 pm

AirBnB now good investment? Will owners now hold and not sell? It’s Jim Cramer but still I can’t keep up.

https://www.google.ca/amp/s/www.cnbc.com/amp/2020/08/24/airbnb-ipo-could-be-the-steal-of-the-century-jim-cramer-says.html

Rent out private/non germy swimming pool too (ABB owners can make deal w/neighbour)?

https://www.google.ca/amp/s/beta.ctvnews.ca/content/ctvnews/en/national/lifestyle/2018/9/20/1_4102594.html

https://www.google.ca/amp/s/ca.finance.yahoo.com/amphtml/news/how-the-airbnb-of-swimming-pools-is-surviving-covid-19-221429758.html

Crazy.

#12 Dolce Vita on 08.25.20 at 3:29 pm

“No proven therapies or approved vaccine”

HK tourist to Europe comes back infected with COVID-19, no biggie?

Actually IT IS. REINFECTION.

2nd time he got infected. No antibodies 2nd time around.

Implications are NO HERD IMMUNITY POSSIBLE WITH A VACCINE. Luckily he was not very sick, asymptomatic BUT his body was fighting some sort of infection (testing).

NO NEED to panic:

1 instance/23,729,008 cases, so far.

Dr. John Campbell explains it away, sort of (he gets right into it – which worries me, watching him is what I imagine a meeting of Fauci and the CDC would be like).

He uses a preprint of the paper (to review) that will appear in a peer reviewed medical journal named “Journal Clinical Infectious Diseases”:

https://www.youtube.com/watch?v=zJJ5gw2cVkA

How concerned? In HK they GENETICALLY SEQUENCED the strain of virus that the HK tourist had.

You know, go in for a swab and come out genetically sequenced. I mean, that happens every day right?

———————

Don’t bother with World press reports like CNN etc. they are garbage, not a part of the HK study (apparently by competent and respected Doctors in the field).

Doc Campbell covers it well. He is not concerned…well he says, FOR NOW.

———————

Makes me remember reading news reports in Italia this past January where 3 Asian tourists got sick with some sort of virus in Roma and Napoli. The rest you know.

FWIW

#13 Mean Gene on 08.25.20 at 3:30 pm

Hmm no mentioned of the ubiquitous Foreign Buyer, so they don’t have much impact to the past and current run up on prices, it’s all driver by local tools and Realturds® who are NOT licensed, trained or educated to provide investment advice. PFO turds.

#14 The real Kip (Ret) on 08.25.20 at 3:39 pm

You talking about real estate or stock markets?

The one that pays you money to own assets, has no realtors, land transfer tax, 5% commission, property tax or insurance costs. But, of course, you wouldn’t know. – Garth

#15 Captain Uppa on 08.25.20 at 3:41 pm

JPMorgan announces part time WFH.

“We are going to start implementing the model that I believe will be more or less permanent, which is this rotational model,” Pinto told CNBC in a Zoom call from London, where he is based. “Depending on the type of business, you may be working one week a month from home, or two days a week from home, or two weeks a month.”

Link: https://www.cnbc.com/2020/08/25/jpmorgan-will-have-staff-cycle-between-office-and-remote-work-in-a-move-that-may-remake-wall-street.html

#16 Northshore guy on 08.25.20 at 3:42 pm

Many people miss the leverage factor in RE. Buy a condo for $500k with 10% down. 3 yrs later that condo has appreciated to $550k many look at it as a 10% return when it’s actually a 100% return. Leverage is how true wealth is built. You need to get your money working.
—————————————————
Why would you put down 10% ?
CMHC allows 5% down. Better to invest the other 25k in TFSA..

Also that realtor forgot to mention if you sell at 550k he will take a chunk of money out of your profits. And they never mention closing costs.

As for Evan, I had to rub my eyes when I saw that twit. Finally someone in public office we can respect.

#17 Guru Raghav on 08.25.20 at 3:45 pm

End of mortgage deferrals. Is that a real threat? Why would it increase supply suddenly. If the seller cannot hold the property after the deferrals end why would they wait for the deferrals to end? Given the return of crazy times, wouldn’t we see those listings now?

#18 yvr_lurker on 08.25.20 at 3:46 pm

The argument you have made here about the risk in housing certainly makes good sense now (less so of course in 2010-2017 when some made a killing in YVR off of real estate).

However, what makes no sense to me is why the same severe risk seemingly does not apply to putting new $$$ in the over-inflated stock market. Has Mr. Market been vaccinated and have lasting immunity against a severe downturn? Or is one day Mr. Market going to suddenly realize the economic carnage out there in many sectors and jump off a cliff. I am betting to some extent on the second outcome.

#19 Dolce Vita on 08.25.20 at 3:48 pm

Read that response from Siddall to the ridiculous leverage argument from the Realtor (you know, pure profit, no expenses whatsoever…on back of a napkin calculation).

Was going to mention it but was hesitant.

Good you posted it Garth.

Of course, along with Siddall there were your usual juvenile Twitter Comments consisting of GIFs of mic drops, Michael Jackson eating popcorn, etc.

You know, people that think they are on TikTok and so want to be a part of things but haven’t a clue how – so, they go “coloring book”.

#20 AM in MN on 08.25.20 at 3:57 pm

Another assumption to keep in mind when considering the long future is the assumption, especially with a SFH, that you “own the dirt”.

Do you, just because you pay for it?

What does the term “crown land” or a “title in fee simple” really mean?

What if Canada ditches the monarchy and there is no more crown land? Is it possible that the left wing activists who populate the Supreme Court benches might change the definition of a legal term that had been clearly understood since the beginning of time?

Check out this below from the Manager of the City of Vancouver. Pay attention to the phrase “decolonization”.

Hey Garth, what are your pronouns?

——————–

From: Johnston, Sadhu
Sent: Thursday, August 20, 2020 5:11 PM
To: All Staff (COV) – DL
Subject: Introduction to Intersectionality and Equity Guiding Documents

Dear colleagues,

At the City, work is currently underway to develop the Equity Framework, a City-wide initiative that will help us to transform our internal structures in order to equitably serve our diverse communities. This work is grounded on the priority actions identified in the Healthy City Strategy and the City of Reconciliation Framework, and it takes an Indigenous-centered, race forward and intersectional approach to embedding equity in our policies, practices, and processes.

The commitments of the Equity Framework include creating spaces for learning and doing equity work, such as eliminating barriers to engagement. Our Arts, Culture and Community Services (ACCS) department has worked collaboratively with staff across various City departments to develop initial tools to help us continue efforts to embed equity in all our work. These are living documents that will be updated on a regular basis, and include the Introduction to Intersectionality, the Equity Reference Guide, and the Equity Decision-Making Tool. These tools are now posted on the new central Citywire page dedicated to providing staff with information on the City’s equity and anti-racism work.

The Introduction to Intersectionality provides a background of intersectionality as an approach to equity, and uses narratives and personal reflections to highlight key equity concepts. Links to additional resources and a glossary are also included to help us deepen our understanding and application of an intersectional approach to equity in our work.

The Equity Reference Guide provides equity considerations that, when applied, can assist us in embedding equity in the development and implementation of projects, policies, practices, processes programs, and services across City departments. This guide grounds equity within the contexts of human rights, decolonization, and intersectionality, and includes questions to consider in multiple areas of our work and a list of resources for further reading.

Lastly, the Equity Decision-Making Tool is a short guide that includes ten questions for staff to consider in making decisions or taking action on a project, program, policy or service. The questions focus on addressing barriers, examining impact, ensuring alignment and partnership, providing opportunity and accountability in all aspects of our work.

As the Equity Framework is finalized to be forwarded to Council in late fall, it will provide additional resources to guide staff in integrating equity throughout the City of Vancouver’s policies, programs and services. If you have any feedback on these resources, please contact ACCS at [email protected]

Thank you all for the role that you each play in advancing our City’s commitment to equity.

Best,

Sadhu

Sadhu Aufochs Johnston | City Manager

Office of the City Manager | City of Vancouver

604.873.7627 | [email protected]

Pronouns: he, him, his

#21 Ron Jeremy on 08.25.20 at 3:58 pm

#137 Dharma Bum on 08.25.20 at 9:30 am
#128 Billy Bob

So if you have ever wondered why fire fighters often sport a moustache but never a beard, now you know.
——————————————————————–

Really?

An all along I thought that it was so they could look like 70’s porn stars when posing for those stupid firefighter calendars!
————————————————————

For your info cowboy, I still sport a moustache…

#22 The Woosh on 08.25.20 at 4:00 pm

For some, this may not end well.

————————————

True, but that’s been the case throughout time. Most will be fine and a few will make out like bandits.

#23 Linda on 08.25.20 at 4:01 pm

So the question I have is this: if people borrow sums they can’t reasonably expect to repay & the price of RE drops, what consequence? The bank/mortgage company don’t want the asset, they want the payment. So I don’t see them in any hurry to repossess & even if payments cease, our government has shown it is more than willing to suspend evictions for renters during the current crisis. One must believe that would extend to evictions for underwater mortgage holders too. Debt one can’t repay vs. even larger debt one can’t repay. My point being that poor financial decisions apparently don’t have consequences in the world we currently live. Not that I condone it, but I sure can see why so many are joining the party.

#24 Crazy Tim on 08.25.20 at 4:08 pm

As long as interest rates are low, prices will be high.
Stocks and home prices will soar to new levels. Dow 40k after Exxon departure and more dinosaurs kick it.

However, there is a serious problem with tech stock valuations that boomers seem oblivious to. I’m surprised there’s been no comment on that especially since the boomers that read this blog lived through the first tech bubble. Welcome to Tech Bubble 2.0.

Thank me later

#25 the Jaguar on 08.25.20 at 4:11 pm

It would be reasonable to think that as time and human society evolved people would have transformed into better and improved versions of themselves. Unfortunately not the case. Social graces have been on a steep decline for about 20 years, with meaningful communication downgraded to text message, Facebook exchanges, and strident social media outbursts.
The ability to think through serious issues, take an appropriate response while bearing in mind the consequences of actions to ourselves and others is disappearing like a fart in a hurricane. It’s becoming akin to teaching cursive writing skills in the school curiculum. It’s not viewed as relevant. It doesn’t register on the radar of the brainless at all. We’ll see how that works out when the fragile electrical grid fails us.
That unfortunate mode of thinking also lends itself very well to consumerism, which is what housing has become. It’s not shelter for oneself and the family anymore. It’s some brutish, bizarre little game of ‘on line poker’ using houses. Never has the phrase ‘Be careful what you wish for, you may get it’, been so timely.

As for Evan Siddall being a ‘cowboy’, we attach great value and admiration to that word and those who have the chops to embody what it stands for here in the great city of Calgary. I might put forward Evan Siddall’s name for Grand Marshall of the Calgary Stampede Parade in 2021. He’s certainly earned it and my admiration.

#26 LS in Arbutus on 08.25.20 at 4:11 pm

I have one thing to add about working from home. I *love* it and so do my bosses and none of us were big supporters before.

If I need to take a child or myself to an appointment/lesson school – no big production of driving back across town to go. Mark myself away from my desk for a couple of hours (at most) and often 30 minutes or less.

I see way more of my kids and spouse and they are certainly more interesting (to me) than my coworkers (and I like my coworkers.)

The autonomy people want, that privacy, it’s come back. We have to remember that the open office concept was pushed onto *everyone* despite almost all hating it. Particularly if you are doing concentrated, quiet work, open office doesn’t work. Working from home is way quieter than the open office, even with kids and spouse stomping around, because *alas* I have a door!!! And I can spread out.

For me, work from home has been more productive and my mental health is better when I can concentrate. Working from home has been a net plus other than the feeling that I am “living at work” and some pretty long hours due to the pandemic.

#27 Learn2investkid.com on 08.25.20 at 4:13 pm

I saw that on Twitter. I was glad to see Evan Siddall respond the way he did. We need more of that. The next wave will be interesting because most government and payment deferral programs will end. The bankers aren’t so friendly when you have negative equity.

#28 In Garth, Not God We Trust on 08.25.20 at 4:14 pm

#113 dogwhistle on 08.24.20 at 10:36 pm

All that boot licking will still not get you invited to the next lobster fest. Only repenting realtors are invited.
——————————————————————-
What?? I was planning a front row seat at the annual blog dog xmas party wearing my Garth Rocks! tshirt and now you tell me this??

#29 TurnerNation on 08.25.20 at 4:20 pm

Being a big picture guy I ran this though Windows calculator in ‘Scientific mode’:

820,000 / 7,500,000,000
= 1.0933333333333333333333333333333e-4

Can anyone translate I must calculate my risk? TIA.

#30 mike from mtl on 08.25.20 at 4:22 pm

#7 JB CONDO DEATH on 08.25.20 at 3:21 pm

My wife had to visit another nurse at her condo yesterday and above were her exact thoughts as she walked into the lobby. She was fully masked and has surgical gloves, plus hand sanitizer.
//////////////////////////////////////////////////////////////////

What a Hypercondriac, sheesh.

#31 Kilt on 08.25.20 at 4:24 pm

What does a jobless renter do if they become evicted?

If they don’t have money to pay rent, how would they rent somewhere else?
Live in there car?

Kilt

#32 Niagara Region on 08.25.20 at 4:25 pm

Here are the City of Toronto’s new rules for AirBnB rentals:
https://www.toronto.ca/news/city-of-toronto-registration-of-short-term-rentals-to-launch-september-10/

#33 Do we have all the facts on 08.25.20 at 4:27 pm

The Greater Fool theory is based on an assumption that no matter what you pay for an asset there will always be someone, ‘the Greater Fool’ , who will pay more. When the asset being purchased is a dwelling you can live in the possibility that the price you paid today will increase over time becomes extremely attractive.

Supporters of the Greater Fool theory tend to overlook the extent that intervention by the Government of Canada has contributed to the the escalation of house prices.

– mortgage insurance and reducing risk for lenders
– extension of amortization periods
– lowering interest rates when necessary
– approving the creation of mortgage backed securities
– purchasing $billions of MBS in the secondary market
– creating Canada Mortgage Bonds with guaranteed return
– purchase of $billions of CMB by the Bank of Canada
– lowering down payment requirements
– offering grants to first time home buyers
– increasing immigration targets by more than 100,000
– exempting primary residences from a capital gains tax
Etc etc.

All of these interventions and many more were designed to increase the demand for housing and the stimulation of demand resulted in an escalation of average prices.

As it stands in 2020 the government stimulation toolbox is virtually empty and the supply of Greater Fools is becoming linked to the amount they have saved for a downpayment and their gross household income.

CMHC has an excellent handle of the number of Canadian households that are in a position to purchase their first home at current price levels. The number of qualifying household has declined by a significant amount in 2020 for reasons noted by Garth above. As a result of reduced demand average prices will eventually decline to a level where demand can be restored.

This is how all markets function in the real world.

#34 Ballingsford on 08.25.20 at 4:30 pm

Get the loan now while rates are cheap. They’ll be similar.in 5 years.

On another note. Paranoia will destroy ya! Try to get a life folks. Either we die or we don’t.

The more I see masks these days and people wearing them when they dont need to, makes me want to puke.

#35 TurnerNation on 08.25.20 at 4:32 pm

#7 JB CONDO DEATH you are breaking down mentally it appears. I was looking though an major online dating app. People can set their “Covid dating” settings as blank or specify, ‘distanced’, ‘distanced w/mask’, or ‘virtual’.
Many nurses I noticed (they listed their occupation). And Not one had set any of the above setting.
Ditto for those listing ‘health care worker”

#36 Who's Your Daddy? on 08.25.20 at 4:34 pm

#108 AM in MN on 08.24.20 at 10:05 pm

“… in 2009 when the Green Energy Act was passed, but the stated goal was to double energy costs so people would use less.”
—————————————————————-

Ever heard of the Efficiency Paradox? It offsets the doubling of energy costs and explains why consumers use more energy.

#37 Interstellar Old Yeller on 08.25.20 at 4:35 pm

Thanks Garth and Evan. There needs to be many more reminders that leverage cuts both ways.

#38 Matt W on 08.25.20 at 4:36 pm

$50,000 gain

Minus
$15,000 – CMHC Fee
$10,000 – Realtor Fee (Ball Park)
$1,500 – Other closing costs.

Plus, who knows if you even broke-even on rental income for 3 years. Highly unlikely.

#39 Masks really do make some people more attractive on 08.25.20 at 4:46 pm

This is how a true RE titan makes money:

https://www.forbes.com/sites/danalexander/2020/08/25/trump-has-now-moved-23-million-of-campaign-donor-money-into-his-private-business/amp/?__twitter_impression=true

#40 Dogman01 on 08.25.20 at 4:47 pm

AI our savior?

Problem with Human Decision makers:

“When I was young and naïve, I believed that important people took positions based on careful consideration of the options. Now I know better. Much of what Serious People believe rests on prejudices, not analysis. And these prejudices are subject to fads and fashions.”
– Paul Krugman

In addition, as we have seen with WE and countless other decisions we have no access to, the trend is to reward your friends….I have been in Govt and seen the shenanigans that follow most contract awarding.

(as a side bar I saw a recent list of qualified bidders for a large Federal contract and IBM is on the list, remember Phoenix Pay system fiasco—yes that IBM)

Now AI
“It would be amazing to make tax policy less political and more data driven,” says team member Alex Trott.

https://www.technologyreview.com/2020/05/05/1001142/ai-reinforcement-learning-simulate-economy-fairer-tax-policy-income-inequality-recession-pandemic/

“The tool could already be used to sanity-check existing economic models: “If I were a policymaker, I would fire this thing up to see what it says.” If the AI Economist disagreed with other models, then it could be a sign those other models were missing something,”

I for one will welcome our robot masters.

We will require some sort of Inheritance tax or we are on our way back to an Aristocracy. (let’s face it if you got 20 million and you are not an idiot you will continue to win into perpetuity or until a great upheaval /revolution)

#41 AntMan on 08.25.20 at 4:47 pm

Seeking thoughts on bank earnings.

#42 gary on 08.25.20 at 4:51 pm

“A crash in immigration”

That’s B.S. As soon as restrictions are lifted, watch the furious snap-back.

Precise Fact: The economy of Canada is nothing more than a leverage on immigration. (same with some other nations)

Immigration has dropped 64% during the pandemic. Let’s hope it restores, since this is a vital economic driver. – Garth

#43 Tater on 08.25.20 at 4:51 pm

Bigland forgets to mention that you paid about 40k in interest cost in that 3 years. So what’s the profit again??

#44 sm_yyc on 08.25.20 at 4:51 pm

i have to say i am starting to like Evan siddall. realturds will push any logic to earn their commission.

#45 baloney Sandwitch on 08.25.20 at 4:52 pm

Home renovation stocks are having a blast. Everyone is fixing their basements, changing their plumbing and gardenening. FAANG’s are not the only way to go.

#46 tbone on 08.25.20 at 4:54 pm

Just wondering how much my house will be worth when the eglinton subway is completed. I live within a 5 minute walk to a station in Etobicoke.
Me thinks it will be more and i am not even a realtor .
As everybody knows … real estate always goes up.

#47 Jake on 08.25.20 at 4:56 pm

The real risk behind the WFH model for many people…

https://www.cnbc.com/2020/08/25/remote-workers-suffer-from-isolationism-as-pandemic-in-us-drags-on.html

#48 Comrade on 08.25.20 at 5:02 pm

#20 AM in MN on 08.25.20 at 3:57 pm
——
You can’t make this stuff up, an environmental consultant and “eco-life” their religion but commutes with float plane regularly. lol

—-

Johnston is married to Manda Aufochs Gillespie,[1] an environmental consultant and writer.

The family lives on Cortes Island, while Johnston commutes regularly between Vancouver and Cortes Island via seaplane.[8] Gillespie has called the family’s eco-life “our religion.

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

#49 DON on 08.25.20 at 5:08 pm

#17 Guru Raghav on 08.25.20 at 3:45 pm
End of mortgage deferrals. Is that a real threat? Why would it increase supply suddenly. If the seller cannot hold the property after the deferrals end why would they wait for the deferrals to end? Given the return of crazy times, wouldn’t we see those listings now?

***********
Would you move out of the house before you had to? Better to get every free month before you have to move.

#50 Dogman01 on 08.25.20 at 5:08 pm

#47 Jake on 08.25.20 at 4:56 pm

The real risk behind the WFH model for many people…

————————————————

I suspect the real risk is employers will realize that much lower cost people can do the job remotely…

#51 Toronto_CA on 08.25.20 at 5:12 pm

This would otherwise be an interesting time to see the RE market absent of overseas buyers.

But as everywhere, the market is hot right now as people are keen to make changes to where they live as a result of shifting priorities. Low interest rates, etc.

The situation in HK continues to deteriorate, will be interesting to see how the West Coast and Toronto do with an exodus of Cantonese Capital.

How much more evidence do we need to realize that the evil, market-pumping foreign buyer stealing Canadians’ homes was a myth? We have done this to ourselves. – Garth

#52 yorkville renter on 08.25.20 at 5:13 pm

#2 Rarely do I see transaction and holding costs factored into their claims and projections.

BINGO!

No where do these R.E. shysters (and this guy is if he’s promoting 100% returns!) speak to:

-Land Transfer Tax
-Property Tax
-Interest Rate Costs
-Utilities
-Maintenance/Repairs
-Bad Tenants

It’s all rainbows and unicorns to these peeps. It should be criminal to push “returns” – it is if you’re actually in the investment industy.

#53 Stan Brooks Psychiatrist on 08.25.20 at 5:15 pm

#146 Ronaldo on 08.25.20 at 11:05 am

“Whoa. That tells me that people in Toronto are in dire need of a psychiatrist. Still a good supply of greater fools there it seems. Your practice must be doing very well at the moment.”
—————————————————————–

I have never been busier. Stanley takes up a great deal of my time but I have new clients coming in droves needing help to sleep at night with $1 million plus mortgages…

#54 Uncle Al Sinclair on 08.25.20 at 5:18 pm

#52 yorkville renter on 08.25.20 at 5:13 pm
#2 Rarely do I see transaction and holding costs factored into their claims and projections.

BINGO!

No where do these R.E. shysters (and this guy is if he’s promoting 100% returns!) speak to:

-Land Transfer Tax
-Property Tax
-Interest Rate Costs
-Utilities
-Maintenance/Repairs
-Bad Tenants

It’s all rainbows and unicorns to these peeps. It should be criminal to push “returns” – it is if you’re actually in the investment industy.
—————————————————————

Now why would you spoil the good narrative of never ending returns with such petty details like all those expenses you list in your post… ignorance is bliss!!

#55 willworkforpickles on 08.25.20 at 5:25 pm

The overall cost of living is core to the rage, fury and lawlessness in the US.
Unemployment levels working age citizens have never seen before in history are here.
Too many are past the breaking point in their ability to cope with the cost of living that’s indeed higher today than at any time before now.
US government support leeway is also at a tipping point.
The dam of building rage is ready to burst open onto American streets like never before seen in history with it.
QE has pretty much had the biscuit for awhile here and north of the border and everywhere else if governments intend to keep inflation manageable and interest rates down in this global recession.
So what real stimulus support can the beleaguered unemployed masses expect in the near to mid term but very little and protracted suffering.
When society blows its top we will see more QE everywhere on a massive scale followed by spiraling inflation and the need to raise interest rates considerably in an attempt to counter it.
A rise in interest rates down the line does not bode well for the crazies overleveraging now.
Unemployment isn’t dropping its rising along with the pain factor in the US and soon enough will too in Canada.
A new reality is upon us with farther reaching implications than many if not most realize.
Good luck all you wound and bound bidding mad garden variety greater fool cabbages…your much a head in the game.

#56 Uncle Al Sinclair on 08.25.20 at 5:27 pm

#46 tbone on 08.25.20 at 4:54 pm
“Just wondering how much my house will be worth when the eglinton subway is completed. I live within a 5 minute walk to a station in Etobicoke.”
—————————————————————–
Is your lot more than 10 feet wide? Does the property have a house larger than a garden shed? If you answered yes to both questions, you are looking at a couple million Canadian dollars…

#57 YouKnowWho on 08.25.20 at 5:32 pm

#29 TurnerNation on 08.25.20 at 4:20 pm
Being a big picture guy I ran this though Windows calculator in ‘Scientific mode’:

820,000 / 7,500,000,000
= 1.0933333333333333333333333333333e-4

Can anyone translate I must calculate my risk? TIA.

————–

I will attempt to translate.

First of all, it’s 7,800,000,000 not 7,500,000,000

World Crude Death Rate is just about 8, so lets say 62.4M – that’s right boys and girls, over 62M people DIE each year. Sugar, weed and VW Diesel pollution appear to really be at it. Death and Taxes baby!

Let’s say 50% of the 820K die in next 4 months, and we get to 1,230,000 total deaths attributed to Covid by end of 2020, that’s still under 2% of the crude death rate.

Another words, 98% of those who will die this year, will die of other reasons than Covid. Shocking because 98% of the news is Covid. How can this be?

It appears that about 50% of all deaths are in those 75 years or older according to stats. 75% if you dip down to 65 year or older.

Since the life expectation for world is 71.4 years, it seems Covid is the bouncer announcing last call.

I will allow no more posts diminishing and marginalizing the tragedy so many families feel at the loss of a member to the virus. Why not shrug off breast cancer victims. Would you enjoy that as much? – Garth

#58 Canada Doodle on 08.25.20 at 5:33 pm

The borders aren’t closed!!!! Have you been to Pearson lately???

The Canada-US border is closed to non-essential traffic. Some provinces require a 14-day quarantine after crossing a boundary. It all hurts the economy. – Garth

#59 YouKnowWho on 08.25.20 at 5:36 pm

#7 JB CONDO DEATH

__________________________

Really? You think the health care pros are such experts with PPE?

“In yet another study from last year, researchers in Chicago observed healthcare workers taking off their person protective equipment (masks, gloves, gowns, etc)—the removal is called doffing. This is a time when healthcare workers can easily self-contaminate by taking gear off incorrectly. The researchers found that healthcare workers incorrectly removed their protective gear 90 percent of the time.”

https://arstechnica.com/science/2020/04/should-you-wear-a-face-mask-heres-all-the-data-we-have/

#60 Stompin Tom Connors on 08.25.20 at 5:38 pm

As for Evan Siddall being a ‘cowboy’, we attach great value and admiration to that word and those who have the chops to embody what it stands for here in the great city of Calgary.
—————————————————————-
Spoken like a real true blue Canadian patriot!! Well done cowboy!

#61 YouKnowWho on 08.25.20 at 5:44 pm

#33 Do we have all the facts

This is how all markets function in the real world.
________________________

Hate to brake it to you, but it is clear that Canada missed that “REAL WORLD” subway stop.

On this subway ride that crappy $1M dog-house that Garth said was worth it for land value and as we know actually sold for $1.8M was probably bought by a realtor association to help perpetuate the illusion of value. It would have been worth it for them to buy it just for marketing value in the press and 11 o’clock news. Then the deal can fall apart quietly in the background few days later because of some trivial condition they inserted into the offer.

I leave you with a quote from Wall Street, because let’s face it – it doesn’t get quoted enough, right?

“It’s not a question of enough, pal. It’s a Zero Sum game – somebody wins, somebody loses. Money itself isn’t lost or made, it’s simply transferred – from one perception to another. Like magic. This painting here? I bought it ten years ago for sixty thousand dollars. I could sell it today for six hundred. The illusion has become real, and the more real it becomes, the more desperately they want it. Capitalism at its finest.”

#62 Paul Krugman on 08.25.20 at 5:45 pm

Garth, you have been telling us that housing is over inflated and risky.

I like to look at the data. All I have seen is doubling in prices, two fold, three fold in Canadian housing.

Anyone doing the opposite of what Evan is saying will be fine. This guy is a product of inflated housing talking heads.

#63 Charlie Sheen on 08.25.20 at 5:46 pm

#141 50 YEARS OF MAPLE LEAF INCOMPETENCE! on 08.25.20 at 10:13 am

BUT THE MAKE BELIEVES ARE UNBEATEN IN TWO WEEKS!

TORONTHOLE IS NUMBER 1 – WINNING!
—————————————————————-

I will get you a ticket to a Leafs game next season if you promise to wear a tshirt with your moniker on it. Are you game?

#64 YouKnowWho on 08.25.20 at 5:47 pm

When I say Michael Douglas what do you think about?

To me, he’s always Gordon. The words Oliver put in Gordon’s mouth – poetry!

“The richest one percent of this country owns half our country’s wealth, five trillion dollars. One third of that comes from hard work, two thirds comes from inheritance, interest on interest accumulating to widows and idiot sons – and what I do, stock and real estate speculation. It’s bullshit. You got ninety percent of the American public out there with little or no net worth. I create nothing. I own. We make the rules, pal. The news, war, peace, famine, upheaval, the price per paper clip. We pick that rabbit out of the hat while everybody sits out there wondering how the hell we did it. Now, you’re not naive enough to think we’re living in a democracy, are you, Buddy? It’s the free market. And you’re a part of it. You’ve got that killer instinct. Stick around, pal, I’ve still got a lot to teach you.”

#65 Masks really do make some people more attractive on 08.25.20 at 5:48 pm

#49 Comrade on 08.25.20 at 5:02 pm
#20 AM in MN on 08.25.20 at 3:57 pm
——
You can’t make this stuff up, an environmental consultant and “eco-life” their religion but commutes with float plane regularly. lol

—-

Johnston is married to Manda Aufochs Gillespie,[1] an environmental consultant and writer.

The family lives on Cortes Island, while Johnston commutes regularly between Vancouver and Cortes Island via seaplane.[8] Gillespie has called the family’s eco-life “our religion.

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

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

Vancouver is run by the Hollyhock Farm cult, and has been since the ‘Gregor the Dim’ dynasty. Tides Canada, Joel Solomon, Hollyhock, Cortes Island, Sadhu; it’s a movement, not a civic government. They can justify anything.

#66 CL on 08.25.20 at 5:51 pm

The question is where is the credit coming from? someone is lending these ridiculous amounts of cash to stupid people….or are they stupid? I mean they know the govt will bail out their bad *choices*. So do our fearless banks.

*Insured* mortgages….for the banks….is a massive moral hazard. That’s why we see ridiculous prices in the middle of economic catastrophe.

#67 HELOCs make money on 08.25.20 at 5:56 pm

Garth, you should go easy on housing.

Evan lots of talk, no action. Nice thesis though.

Thanks to HELOCing I have hundreds of thousands of dollars to allocate into top performing tech stocks like Apple that just roll over and double up.

Once highly leveraged, now living high in a castle.

A lot of suckers still report to a job site and a boss.

I report to my own 7-figure bank earnings.

I came from nothing. If Canadian banks are going to give it, I am going to take it.

#68 Brett in Calgary on 08.25.20 at 6:05 pm

#25 the Jaguar on 08.25.20 at 4:11 pm

I might put forward Evan Siddall’s name for Grand Marshall of the Calgary Stampede Parade in 2021. He’s certainly earned it and my admiration.
——————————–
I would second that motion. Atta boy Siddall!

#69 YouKnowWho on 08.25.20 at 6:11 pm

I will allow no more posts diminishing and marginalizing the tragedy so many families feel at the loss of a member to the virus. Why not shrug off breast cancer victims. Would you enjoy that as much? – Garth

ABSOLUTELY NOT!

You know what Garth, I was watching Wonder Years with my kids. There was an episode where the boy living down the street, a teenager, goes to Vietnam and dies. I looked at my kids and had to walk the hell out of the room.

Ever since then, I was thinking about young men of generation past who faced death without fear in wars past. We keep sending them there too. Those Wounded Soldier commercials – can’t watch that stuff.

And now here we are. Today.

What is happening here? Really. Are we more scared of the fact that life that concludes in death than those boys who went to war? Is death a subject that’s off limits? How politically correct and sensitive are we going to get?

I noted this to you in the comment that got deleted. I feel like we’re adults here and can speak like adults for some reason.

Why are Covid deaths more important than the other deaths? It certainly looks like it to me. 62.4M people will die each year because they lived. Simple crude death rate reality. What is this thing we do that my tragedy is more important than your tragedy, which is more important than their tragedy? Is this the decade of social media training in real life application?

If we’re going to mourn death, lets mourn it all. Let’s not pick one over the other – because how is that right? Prioritize one death over the other – News machine does this to us, and we don’t think twice about doing it too.

And if we are going to prioritize, the only priority logic that makes sense to me Garth is by how much life someone had left, because younger death loses more of the gift of life than someone who’s 75 years old and lived the vast majority of their life. That type of priority I can at least understand.

But any priority of death clearly implies that the death of someone from Covid IS more significant and mourn-worthy than someone who died of a cancer, or choking, or a drunk driver, or work place dangers, or just old age.

You say diminishing and marginalizing, I say prioritizing and highlighting.

Are we honestly saying that stress, suicide, financial hardship, depression, drug abuse and OD deaths – all caused by the actions of our “leaders” that are being taken in this pandemic aren’t worthy of attention? They are in that 98% of deaths remaining after Covid deaths are accounted for. NO ONE is counting those deaths. NO ONE seems to care Garth.

All I’m trying to highlight is the hypocrisy of prioritizing Covid deaths over others. To do this death prioritization for that reason oaths, is nothing short of highest level of insensitivity to all human life. We humans are really good at it too.

I cannot believe that even in death humanity appears UNABLE to be equal and fair. That’s really my point Garth.

#70 I'll admit it ... on 08.25.20 at 6:15 pm

I am biased but live in a great burb of 604. Easy access to the skytrain. Great ocean views. Tall trees. Songbirds. Green. A mill will get you started … but have never seen so many For Sale signs and only a few ever get SOLD signs. And many more for sale with no signage. Don’t see any lineups here … thankfully …

#71 Pete from St. Cesaire on 08.25.20 at 6:15 pm

And up she goes. Of course when you buy something at an inflated price with money you have, risk is contained. When you borrow, it isn’t. For some, this may not end well.
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
Thing is, for many people it’s seen as being the opposite: if they are using their own money they are putting it at risk, if they have no money of their own and just use loans to buy the house they don’t risk anything, they could simply go bankrupt if things go bad.
Along the same vein, you can be sure that in these terrible times many people have concluded that there is likely no future so there will be no reckoning.

#72 Jim Lahey on 08.25.20 at 6:21 pm

#6 YouKnowWho on 08.25.20 at 3:14 pm
O Canada!
Our homes on native land!
True love of debt in all of us commands.

With glowing hearts we see thee rise,
The one million dollar 10 foot wide semi!

From far and wide,
O Canada, we drown in debt for thee.

Queen owns our land, glorious and free!
O Canada, we drown in debt for thee.

O Canada, we drown in debt for thee.
————————————————————–
I love it!! Now do you sing? We could have you sing your gem at the annual blog dog xmas party.

#73 YouKnowWho on 08.25.20 at 6:25 pm

In theory a couple with a household income of $300,000 and a hundred grand for a down payment would qualify for a mortgage of $1.23 million at 1.59%

———————————————–

This is from yesterday.

How many of these people are out there? Do we have numbers? I think Garth said that’s a 1%er, right? Something like $280K+ is a 1%er – isn’t it? And if they are earning $300K – and can afford 1.23M, it is still not enough, and an amazing $570K short (plus land transfer taxes) for that bicycle garage that sold last week for $1.8M.

Someone explain this to me – when houses were 1/2 the current price, already the prices were detached from logic. How are they logical at this level?

The only explanation is that the dollar has devalued quietly by that much.

If a detached was crazy at $900K as far as fundamentals go, how does it make more sense at $2M?

MEANWHILE…in the south of France, where it is 17C in December and January…this…

https://www.french-property.com/sale-property/1-IFPC28689

#74 YVRPeasant on 08.25.20 at 6:36 pm

Would you not think there will be another run up in housing?

As you said yesterday: “Never doubt the inverse relationship between house prices and interest rates.”

Tiff has already said rates will be low for a long time. And it seems like every time they start to creep up, something comes along to send them to the floor again.

#75 Reximus on 08.25.20 at 6:43 pm

#12 Dolce Vita on 08.25.20 at 3:29 pm

Interesting thing about that HK patient…both times he was found to be CV19 positive, he had no symptoms or difficulties, perhaps he’s evidence that if you dont have any symptom, you dont get any immunity?

#76 Ian from Oshawa on 08.25.20 at 6:53 pm

Thank you, Mr. Turner.

I really enjoying your blog, particularly at the end of an aggravating day.

Been fighting the FOMO for a long time now. Often feeling like I’m letting my family down. Saving, paying off debt, and missing out on the low, low interest rates.

I’ve heard PLENTY of people (mostly realtors) saying that house prices ONLY go up. I think they’re wrong, and you give me hope that my ship may indeed come in. Maybe I will own a house (again.)

Thank you for helping a novice like me understand this madness.

With sincere gratitude,

Ian from Oshawa

#77 Cto on 08.25.20 at 6:58 pm

but, but , Garth, the debt snorkelers are winning because the bank of canada is spending hundreds of billions, soon to be trillions of our money to back the housing speculators.
Word on the street is that the BOC will always have your back no matter how much you borrow…so….why wouldn’t you.

#78 crowdedelevatorfartz on 08.25.20 at 7:06 pm

@#20 AM in MN
“As the Equity Framework is finalized to be forwarded to Council in late fall, it will provide additional resources to guide staff in integrating equity throughout the City of Vancouver’s policies, programs and services. ”
++++
Blah, blah blah…..blah blah blah… blah blah blah
A city manager hauling in probably 200k per year to spew out drivel that no one gives two shites about….unless they are fart catching, bootlickers.

And 90 % of the City of Van staff…..roll their eyes, shake their heads, ignore the lastes garbage dumped from “on high” , go back to their jobs………and realize why the city has no money for more staff or raises.

I cant wait to see a lack of taxpayer funds crush the jobs of the politically correct, Orwellian doublespeaking, horseshite splatting , navel gazing govt bureaucrats like this……

A complete reset would be wonderful.
“Yeah yeah yeah, equity schmeck-quity. Here’s a shovel comrade, start shoveling shite, the outhouse is full.”

#79 Ponies Pilatus on 08.25.20 at 7:12 pm

#71 we know who
You made your point often enough.
We get it.
Time to move on.

#80 crowdedelevatorfartz on 08.25.20 at 7:15 pm

@#31 Kilt
“What does a jobless renter do if they become evicted?
If they don’t have money to pay rent, how would they rent somewhere else?
Live in there car?
++++

Asking for a “friend” Scotty?
Not to worry.
I’m sure the news will be filled with stories of “heartless” landlords kicking out renters who have made zero attempt to pay even a quarter of their rent (while drawing CERB) since this entire Trudeau socialist experiment shiteshow started.

#81 dogwhistle on 08.25.20 at 7:16 pm

#42

Immigration has dropped 64% during the pandemic. Let’s hope it restores, since this is a vital economic driver. – Garth

——————————————————

Immigration (not TFW or refugees) costs a fortune
you pay for fees etc etc etc.

Cost of living in Canada is worse than most of the western world.

Real estate? Cardboard and compressed wood that last 20 years versus properly built? London (UK) prices or Paris
prices for (dramatic pause) Oshawa? lol

Weather? well…

Not having your degrees recognised? Priceless…

Having to deal with a percentage of the population openly hostile? (Not all of course)

Business? LOL LOL LOL.
That’s been killed, it has ceased to exist.

Taxes? MEGA LOL.

It can only attract people from the third world or fleeing China, maybe some who can no longer get H1B visas in the US and are sent to the ‘back office” up north. LOL

I see plenty of small businesses for sale.
The cost of people retiring and their healthcare is going to be a killer for the budget (won’t balance itself) with very few people having any taste for ‘risk’ after 2020 and why would they when your government hates you? why take any risks?

Also, in the next few years there will be more competition to attract those who do, those who takes risks, and they are many more attractive locations in the world.

Meh. Better polish the poster of the rockies, there’s going to be some marketing to be done here. I remember when Quebec used stock pictures of the rockies. LOL.

#82 Uncle Al Sinclair on 08.25.20 at 7:22 pm

#75 YouKnowWho on 08.25.20 at 6:25 pm

MEANWHILE…in the south of France, where it is 17C in December and January…this…

https://www.french-property.com/sale-property/1-IFPC28689

————————————————————-

This property is 100k Euros cheaper, in Tuscany, has its own watchtower (not the Jehovah’s Witness type), built in the 10th century, a vineyard and a butler named Giacomo…

https://www.immobiliareitaliano.com/property/unique-tuscan-property/

#83 crowdedelevatorfartz on 08.25.20 at 7:23 pm

@#49 Comrade
“The family lives on Cortes Island, while Johnston commutes regularly between Vancouver and Cortes Island via seaplane.[8] Gillespie has called the family’s eco-life “our religion.

++++

I think I just threw up.
But its organic so i guess thats ok.

#84 Stone on 08.25.20 at 7:28 pm

#22 The Woosh on 08.25.20 at 4:00 pm
For some, this may not end well.

————————————

True, but that’s been the case throughout time. Most will be fine and a few will make out like bandits.

———

Nah! Most will get kicked in the gonads and suffer butthurt…as has been the case throughout time.

#85 Nonplused on 08.25.20 at 7:30 pm

Just got off the phone with my advisor and he suggested selling everything that needs selling and stuffing the TFSA to max before the capital gains inclusion rate goes up, which his firm figures is pretty likely for 2021. Garth has mentioned this possibility many times but there seems to be a consensus forming amongst his peers. Maybe they all read this blog. That actually wouldn’t surprise me.

Here is his (firm’s) arguments:

Capital gains tax on primary residences: Dead in the water as too many voters have one and it is their primary retirement plan. It would be viewed as “stealing my retirement money”.

Raising income taxes: Nope nobody who actually pays taxes wants to see that. Maybe an increase on the people already in the top rate but it won’t be enough.

Consumption taxes: Nope making the poor pay more for a slurpee ain’t gonna work. They will just stop buying slurpees when they run out of money.

Therefore the low hanging fruit is the capital gains inclusion rate. Their forecast is 75% for 2021 with the risk it could go to 100% in the future. This will be the Yuugest tax increase they could implement without pissing off most of the voters.

It seems the banks are quite concerned that Morneau out and Freeland in suggests Trudeau is about to implement his crayon colored plans for big social spending and green power mandates. But with very little that isn’t taxed to the max already, the capital gains inclusion rate is the most politically expedient target.

So stuff those RRSP’s and TFSA’s to the max folks and especially the TFSA and do it now before the capital gains inclusion goes up. I let my TFSA languish for too long because I would have had to transfer from a cash account to the TFSA and thus incur a tax, but a period of unemployment gave me a window to do that with low effective tax rates so it is all stuffed up now. But I think I am a year behind so I’m going to stuff it again.

He also suggested selling some gold because it’s over my target weighting again. We just did that a few months ago but I guess nobody ever went broke taking a profit. That’s the beauty of rebalancing. You still have your weighting, but now you have other stuff too. I know Garth doesn’t like gold one little bit but it has worked good for me once I started sticking to a firm maximum weighting. Yes it has been on fire lately. I sell some anyway. Back to the weighting.

Also talked to another friend today who is quite well connected and he concurs with Garth that it will be Prime Minister Freeland after the next election or perhaps before. Trudeau has just become too much of a liability for the Liberals with his swarm of scandals. Freeland provides all of the same socialist economy destroying but vote winning policies but in a much cleaner package. They are, no doubt, grooming her.

#86 Ponzius Pilatus on 08.25.20 at 7:31 pm

Let’s assume that WFH will be permanent.
The question then is, what should/will happen to the windfall that the corporations will reap due to lower operating costs?
Possibilities:
Increase dividends
Increase executive bonuses 
Increase salaries
Increase retained earnings
Pay more taxes voluntarily (joking, of course)
Give to charity (again, joking)

Any suggestions?

#87 crowdedelevatorfartz on 08.25.20 at 7:32 pm

@#65 Charlie Sheen
” will get you a ticket to a Leafs game next season if you promise to wear a tshirt with your moniker on it. Are you game?”

+++

I’ll chip in for tickets if he gets to sit beside your ex-wife Denise Richards.
Apparently she cant start or finish a sentence without dropping 4 or 5 “F-Bombs” like a drill sergeant during basic training …..

My kinda gal!

#88 willworkforpickles on 08.25.20 at 7:34 pm

#78 Cto
If Trudeau is to go on bailing the masses of unemployed out and so far plans to, the method he’s left to do so thereabouts is with more and more QE.
Kiss low interest rates good bye soon thereafter or let inflation run rampant. QE, Inflation, Int. rate hikes. Expect to see all three.

#89 dogwhistle on 08.25.20 at 7:35 pm

#83 Uncle Al Sinclair on 08.25.20 at 7:22 pm

MEANWHILE…in the south of France, where it is 17C in December and January…this…

https://www.french-property.com/sale-property/1-IFPC28689

————————————————————-

Plus that property can be used as a business.

If you make less then 170000 euro from it you’ll only pay tax on 30% of that amount.

Leaves nearly 10000 euro per month, enough for a few bottle of rose wine, maybe some cheese for less than 10 dollars per gramme.

That part of the world is always in demand.

#90 Stone on 08.25.20 at 7:38 pm

#34 Ballingsford on 08.25.20 at 4:30 pm
Get the loan now while rates are cheap. They’ll be similar.in 5 years.

On another note. Paranoia will destroy ya! Try to get a life folks. Either we die or we don’t.

The more I see masks these days and people wearing them when they dont need to, makes me want to puke.

———

Dry heaving a lot?

#91 Nonplused on 08.25.20 at 7:44 pm

Oh I forgot Mr. Advisor was also pretty down on REITs, especially ones long nursing homes or retail. Apparently some nursing homes are operating at 60% capacity as people move their elderly parents into the basement rather than put them in quarantine. Covid may change everything for some time to come. Some of these changes are permanent. We aren’t going back to the way things were. But, on the other hand, when did we ever? When did we want to?

#92 Madcat on 08.25.20 at 7:47 pm

This is very scary (see link below). I just took the survey and it seriously sounds like the Bank of Canada is considering negative interest rates. Everyone who frequents this blog has a duty to fill out the survey and scream at the top of their lungs that they want the bank to target inflation. Target inflation.

https://letstalkinflation.ca.engagementhq.com/lets-talk-inflation-survey/survey_tools/take-the-survey-today1

#93 Don Guillermo on 08.25.20 at 7:51 pm

#83 Uncle Al Sinclair on 08.25.20 at 7:22 pm
#75 YouKnowWho on 08.25.20 at 6:25 pm

MEANWHILE…in the south of France, where it is 17C in December and January…this…

https://www.french-property.com/sale-property/1-IFPC28689

————————————————————-

This property is 100k Euros cheaper, in Tuscany, has its own watchtower (not the Jehovah’s Witness type), built in the 10th century, a vineyard and a butler named Giacomo…

https://www.immobiliareitaliano.com/property/unique-tuscan-property/
*****************************************
Now those would be great WFH locations!

#94 Blacksheep on 08.25.20 at 7:58 pm

Bigland’s right.

Siddal’s wrong.

Inflate or die.

What causes inflation?

Drop interest rates to increase the money supply via chartered banks.

What’s T2 about to announce in 30 days?

Mo money, mo money, mo money.

I’m surprised how many Dogs, still don’t see this.

#95 Nonplused on 08.25.20 at 8:04 pm

“Immigration has dropped 64% during the pandemic. Let’s hope it restores, since this is a vital economic driver. – Garth”

Well, maybe when the unemployment rate drops. As I have discussed before but not for a while, and it bears repeating, I think the immigration rate should be inversely related to the unemployment rate. Right now about the last thing we need is more unemployed people on government handouts, whether displaced citizens or immigrants that can’t find a job.

Also as technology displaces workers, something that has been happening for a long time but seems to be accelerating, it seems possible that there might come a day when Canada is “full”. In fact that may be rearview mirror stuff. The birth rate has been falling for years, naturally, all on its own. That is the stuff of markets reacting to market conditions.

#96 Uncle Al Sinclair on 08.25.20 at 8:10 pm

#95 Blacksheep on 08.25.20 at 7:58 pm
Bigland’s right.

Siddal’s wrong.

Inflate or die.

What causes inflation?

Drop interest rates to increase the money supply via chartered banks.

What’s T2 about to announce in 30 days?

Mo money, mo money, mo money.

I’m surprised how many Dogs, still don’t see this.
—————————————————————–
Of course we see it. Some of us own our houses outright and have balanced portfolios and investment income. Central bank money has helped financial assets and real estate. Now stop griping and go out and get yourself a $1.5 million dollar mortgage for a garden shed in Leslieville.

#97 Ronaldo on 08.25.20 at 8:11 pm

Photo reminds me of our neighbours dog. If you tried to break into their house, he would lick you to death.

#98 Blacksheep on 08.25.20 at 8:13 pm

Shawn # 48,

Why don’t you think governments will continue to put a floor under real estate the same way the central banks and governments prop up the stock market?
—————————
See….Shawn gets it, come on Dogs, wake up.

#99 Bob Panczak on 08.25.20 at 8:13 pm

BobP
What are LRCNs?

#100 Ronaldo on 08.25.20 at 8:14 pm

This week the cowboy running our federal housing outfit raged on Twitter against a twit realtor. Well, to be fair, Owen Bigland actually has an outsized opinion of himself. The Vancouver agent has a blog, a book, a degree and boasts he’s been a successful life-long real estate investor. But that don’t impress Evan Siddall much.
——————————————————————
Reminds me of what a wise old man said some years back. “It don’t matter how much paper you have, if you don’t got the tobbaci to put in it, it ain’t worth nutten”.

#101 Nonplused on 08.25.20 at 8:15 pm

#66 YouKnowWho on 08.25.20 at 5:47 pm

Wealth is not money. You cannot spend an Amazon share until you sell it, which means there must be a buyer.

#102 Mark the Carney, Carney on 08.25.20 at 8:16 pm

#93 Madcat on 08.25.20 at 7:47 pm
This is very scary (see link below). I just took the survey and it seriously sounds like the Bank of Canada is considering negative interest rates. Everyone who frequents this blog has a duty to fill out the survey and scream at the top of their lungs that they want the bank to target inflation. Target inflation.
—————————————————————-

We are facing deflation not inflation, hence why the negative interest rates are coming. Wages are stagnant, half the country is on CERB and up to their ying yangs in debt. The BOC is fearing deflation not inflation.

#103 KNOW IT ALL on 08.25.20 at 8:18 pm

This blog SCARES the poop out of me!

#104 Charlie Sheen on 08.25.20 at 8:20 pm

#88 crowdedelevatorfartz on 08.25.20 at 7:32 pm
@#65 Charlie Sheen
” will get you a ticket to a Leafs game next season if you promise to wear a tshirt with your moniker on it. Are you game?”

+++

I’ll chip in for tickets if he gets to sit beside your ex-wife Denise Richards.
Apparently she cant start or finish a sentence without dropping 4 or 5 “F-Bombs” like a drill sergeant during basic training …..

My kinda gal!
—————————————————————-
That she is! Ah the memories…I don’t think I can get her to go to a Leafs game with Toronto Hater. She only goes out with guys who are….WINNING!!

#105 TurnerNation on 08.25.20 at 8:30 pm

#15 Captain Uppa – read between the lines. The article mentions ‘due to social distancing’ – it is, of course, an economic weapon. Fewer people or fewer jobs is their goal?
(A.I. took over most of the lending decisions after the 2008 GFC. )
Consider that fewer workers (in the office) really may be plan for…fewer workers – overall. Ask the airlines and tourism industries.

Weaning us off. Up to 80% of all trades in the stock market are automated – programming algorithms including A.I.-driven anyway. Fewer and fewer people.

#106 Uncle Al Sinclair on 08.25.20 at 8:36 pm

#94 Don Guillermo on 08.25.20 at 7:51 pm
#83 Uncle Al Sinclair on 08.25.20 at 7:22 pm
#75 YouKnowWho on 08.25.20 at 6:25 pm

MEANWHILE…in the south of France, where it is 17C in December and January…this…

https://www.french-property.com/sale-property/1-IFPC28689

————————————————————-

This property is 100k Euros cheaper, in Tuscany, has its own watchtower (not the Jehovah’s Witness type), built in the 10th century, a vineyard and a butler named Giacomo…

https://www.immobiliareitaliano.com/property/unique-tuscan-property/
*****************************************
Now those would be great WFH locations!
—————————————————————-
You got that right!! Imagine having a zoom meeting in your 10th century watchtower…

#107 Ronaldo on 08.25.20 at 8:43 pm

#26 LS in Arbutus

For me, work from home has been more productive and my mental health is better when I can concentrate. Working from home has been a net plus other than the feeling that I am “living at work” and some pretty long hours due to the pandemic.
—————————————————————-
And that is the very reason that employers love it too. They get twice the work out of you for the same price. What’s not to like. I know some that have worked from home long before the covid thing and guess what? That’s all they do. Work, work, work. They can’t pull themselves away from it. It’s there waiting for them morning til night, 7 days a week. Slaves to their work.
Enjoy your WFH. There’s a price to pay for that. Now, if you are in your own business, different story.

#108 Drinking on 08.25.20 at 8:46 pm

My gauge, and this is strictly my gauge, no outside influence, I am not nearly as smart as the rest of you.

I am just waiting for the kiddies to go back to school along with the cold and flu season this winter. If we survive that health wise and economically, then my views will change for next year, but hey, I am just a blue collar worker that knows nothing!

#109 Blacksheep on 08.25.20 at 8:54 pm

Uncle # 97,

“Of course we see it.”

“Now stop griping and go out and get yourself a $1.5 million dollar mortgage for a garden shed in Leslieville.”
—————————–
Good to hear you covered.

But who’s griping?

Just making a counter comment to today’s message after learning the hard way by selling my primary res, in the summer of 2008, 6 months before RE started to rise again, after heavy Gov interventions.

Fool me once…

#110 Nick on 08.25.20 at 8:59 pm

.
Immigration won’t stop or even significantly reduce.
.
No politician or RCMP will stop money laundering.
.
Interest rates won’t go up much, if they ever do.
.
Prices of homes will never go down in Lower Brainland or BC

#111 Nonplused on 08.25.20 at 9:01 pm

#93 Madcat on 08.25.20 at 7:47 pm

I took the survey and it is truly frightening. It is as if they think that 2% inflation is de facto an economic given, when it is in fact just a buffer from the dreaded deflation.

The only purpose of inflation is to prevent widespread debt defaults. It serves no other useful purpose. I mean that is a pretty good purpose, but that is the only purpose.

The ideal inflation rate would be 0%. But I will give the bankers some leeway that 0% is hard to target.

And this crap they spill out like vomit that economic growth causes inflation is just bunk. They think we are children! Economic growth is caused by productivity improvements and capital investments, both of which drive costs down.

Now of course it may be the case that productivity improvements drive down the cost of labor, and profits. Therein lies the problem, as in a deflationary environment debts become hard to service, and that can lead to a collapse. But that is the one and only thing inflation helps with. So a little inflation to avoid collapse, but other than that it does diddly squat for the economy. Changing the size of an inch does not make a 2×4 bigger.

#112 And I'm free...free falling on 08.25.20 at 9:07 pm

Kenney says it will be the “biggest deficit in the history of Alberta by a country mile.”

“It will be well north of a $20-billion deficit in large part because of the total collapse of revenues emanating from the coronavirus recession,” he said Tuesday.

#113 tccontrarian on 08.25.20 at 9:23 pm

I will allow no more posts diminishing and marginalizing the tragedy so many families feel at the loss of a member to the virus. Why not shrug off breast cancer victims. Would you enjoy that as much? – Garth

Stating numbers and ratios and %’s of deaths from this or that is NOT marginalizing anything, IMO. Hell, ONE death would be tragic if it happens to one of my own!
I’m known to shed a tear or 2 in war movies for Dog’s sake, even though I know they’re actors!!

Anyway, it appears as though Cancel-culture has become contagious even here at GF. Another tragedy unfolding … but hopefully not!

#114 VicPaul on 08.25.20 at 9:23 pm

There were a few nuggets of wisdom and a cooperative tone to the Jaguar’s message tonight (#25).

Nice contribution, good sir.

I especially liked the suggestion that we, collectively as dogs here, temper our rebuttals to focus on the ideas and not the person.

These are swift-moving times in our societal growth – and with growth, come pains. I come here for the informed worldview and intelligent analysis of the days/weeks events that the Honourable Mr. Turner graciously purveys – not just financial, although that’s my favourite topic. I’ve come here for many years and feel I’ve learned a lot and realize I can still learn a lot from the intellect that seems to populate this place (notwithstanding the atypical few).

I don’t share the same opinions on many things with the more left-leaning dogs of the blog – but it’s valuable to see the contrast for one’s own orientation.
I appreciate how wonderstruck they are that I just don’t get it (you know, their worldview) – because it is exactly the same incredulousness I feel when I see the hyper-violence in the streets and hear the MSM gloss over it by blaming one person – though any critical thinking would show a fail on many levels. Is it simply politically disingenuous, or is it wilfully dishonest.

We’ve got some stuff to talk about. A return to civility
would help move the conversation forward.

(full disclosure: I’ve been a bit snipey in the past –
no more)

M56BC

#115 Dr. Filippo on 08.25.20 at 9:28 pm

Time to dust off my Tom Vu imitation from the 1980s.

“Do you vant to be poor for the rest of your rife? Off course not my fend, wat you need is income poducing property!”

#116 Silent the people on 08.25.20 at 9:35 pm

Mr. Siddal has put a little honesty back
into our Canadian government!
Remember, I said “ a little “

#117 YouKnowWho on 08.25.20 at 9:39 pm

#83 Uncle Al Sinclair on 08.25.20 at 7:22 pm
#75 YouKnowWho on 08.25.20 at 6:25 pm

MEANWHILE…in the south of France, where it is 17C in December and January…this…

https://www.french-property.com/sale-property/1-IFPC28689

————————————————————-

This property is 100k Euros cheaper, in Tuscany, has its own watchtower (not the Jehovah’s Witness type), built in the 10th century, a vineyard and a butler named Giacomo…

https://www.immobiliareitaliano.com/property/unique-tuscan-property/

——————-

No 18 foot wide lot? No view of neighbours side wall from 9 x 10 foot master bedroom? No backyard wood fence for the 300 soft backyard? No 6 months of snow and slush?

I think I’ll pass.

#118 Ian Derry on 08.25.20 at 9:41 pm

And I’m Free….Falling, that is nothing compared to the huge mistake Canadians will not know until it is too late as they think voting in Trudeau, Freeland will make them better off and stop working living off government cheese.

Listen to Maximo Alvarez’s life story having to leave as a kid from Cuba to escape to the US. Fidel Castro’s Communist paradise for him and his cronies is what Trudeau, Freeland will turn Canada into. The empty promises of everything guaranteed free from healthcare education to medical, dental, childcare, guaranteed annual income etc. etc.

He heard all the empty promises before and the only thing guaranteed under socialism, communism, marxist etc. is poverty.

#119 MF on 08.25.20 at 9:46 pm

82 dogwhistle on 08.25.20 at 7:1

Ah the anti immigrant clown who usually pops up with a group of arguments that are more a reflection of his own failures than the country’s flaws.

The proof is in the pudding, immigrants do exceptionally well here. You just have to actually look around, get off the joke that is the online world, and talk to actual immigrants to see.

Everything you mentioned is a generic criticism that can be applied to every western country. Yawn. Taxes? People coming from countries with real problems don’t care one iota that the tax rate is 20% instead of 19% or whatever. Not important.

You ignored the welcoming atmosphere, stable government, tons of social benefits, socialized health care, good public school system, lack of inequality, and ease of finding a job. Yeah house prices are expensive, but there is a reason for that.

MF

#120 SoggyShorts on 08.25.20 at 9:52 pm

#34 Ballingsford on 08.25.20 at 4:30 pm

The more I see masks these days and people wearing them when they dont need to, makes me want to puke.

******************
You anti-maskers are so strange.
Multiple times I’ve caught myself driving alone while wearing a mask because I simply forgot to take it off when I left the place where wearing one was mandatory.
It’s not a big deal, seriously. I imagine you’re the type who instantly removes his seatbelt when the light goes off on the plane too?
Is your body so sensitive that a little strip of fabric makes you come undone?
So strange.

#121 Drill Baby Drill on 08.25.20 at 9:52 pm

The Conservatives are going to erect a large tent for all to gather. Those with common sense will see this and join in. We need common sense in Ottawa now more than ever. Please Canadian voters get rid of the ideologues (Butts, Telford, Freeland, Hadju et al).

#122 Mark the Carney, Carney on 08.25.20 at 9:52 pm

#112 Nonplused on 08.25.20 at 9:01 pm
#93 Madcat on 08.25.20 at 7:47 pm

I took the survey and it is truly frightening. It is as if they think that 2% inflation is de facto an economic given, when it is in fact just a buffer from the dreaded deflation.

The only purpose of inflation is to prevent widespread debt defaults. It serves no other useful purpose. I mean that is a pretty good purpose, but that is the only purpose.

The ideal inflation rate would be 0%. But I will give the bankers some leeway that 0% is hard to target.

—————————————————————-

Really? The ideal inflation rate is 0%? What degree in economics do you hold? You know better than the central bankers of the industrialized world who target an inflation rate of around 2%. 0% inflation is borderline deflation and the sign of a collapsing economy.

https://www.thebalance.com/inflation-targeting-definition-how-it-works-3305854

#123 Ronaldo on 08.25.20 at 9:55 pm

#106 TurnerNation on 08.25.20 at 8:30 pm
#15 Captain Uppa – read between the lines. The article mentions ‘due to social distancing’ – it is, of course, an economic weapon. Fewer people or fewer jobs is their goal?
(A.I. took over most of the lending decisions after the 2008 GFC. )
Consider that fewer workers (in the office) really may be plan for…fewer workers – overall. Ask the airlines and tourism industries.

Weaning us off. Up to 80% of all trades in the stock market are automated – programming algorithms including A.I.-driven anyway. Fewer and fewer people.
—————————————————————–
Companies will realize that production will begin to increase as they go totally WFH. No more chit chatting around the water cooler about the low interest rate you got to buy that 1.5 million dollar condo or last nights hockey game, etc. etc. etc.

WFH will become so productive that WFHers will work themselves out of a job and the company will put them on part time working half days at half rate.

So the key is not to fall into the work obsession trap. It’s no different than someone working extra hours after work or on weekends for no extra pay. Especially true for managers. Proceed with caution. It may not be all it’s cracked up to be.

#124 Four Noble Truths on 08.25.20 at 9:58 pm

#115 VicPaul on 08.25.20 at 9:23 pm

Your clashes with the left wingers enforces the truism of the Middle Path of Buddhism. While it was not meant to be a political statement in its original intent, it is very applicable to politics. We have a polarized world right now and the left thinks the right is evil incarnate and vice versa. CNN preaches to its choir and FOX News preaches to its choir. There is no middle ground…

#125 Elementary, my dear Watson on 08.25.20 at 10:03 pm

#1 Overheardyou on 08.25.20 at 2:51 pm

This really makes one wonder, how much supply must increase to make a noticeable decline in demand and therefore prices? Are there any stats that could provide a valid estimate?

——————————————————————

This should do it …

ρ = [ 1 / N ] * Σ { [ (Xi – μX) / σx ] * [ (Yi – μY) / σy ] }

#126 Mosey on 08.25.20 at 10:03 pm

“ A 65% plop in immigration, sapping demand.” -Garth

One factor you missed, Garth, is the astonishing number of Canadians who have lived and worked abroad who are now returning home (with spouses and kids in many cases). We just arrived in the Kootenays from the states. There are no rentals available anywhere in the region and home prices are very high. 300,000 ex pat Canucks living and working in Hong Kong-well how many of them are on their way home given the political gyrations of China in that place. A third? Half? Same story for ex pats rushing out of the US. Our Customs officer told us the incredible delays in processing the wife’s PR application are due to an “exodus” of returning Canadians. No immigration – no problem for realtors. Hundreds of thousands of us are either just recently arrived or on the way. Please factor that in – it is real, and not mentioning this as at least part of the reason for the surge in RE prices in Canada misrepresents a major driver of the crazy RE market in this situation. Cheers!

#127 JoinEm on 08.25.20 at 10:55 pm

We bought a condo in Edmonton in 2015 for $324 000. We got a pretty good price on it. The previous owner had paid $322 000 in 2009. We just sold it for $304 000, and we consider ourselves lucky. There are 7 other units for sale in the building. Between some money we put into upgrades, the decrease in value, lawyer fees, and holding costs, we will get basically our down payment back from the equity we have in it. We probably should have invested that $64 000 down payment 5 years ago. Who is smart? What would that $64000 be worth today if I bought VGRO?

#128 Ace Goodheart on 08.25.20 at 11:16 pm

Watching as the world pivots towards the next dirty source of mobility for the masses: the electric car.

When I was younger, I had a lot of old diesel vws.

I still have three of the engines. One is in a 1986 westfalia camper that I rebuilt. The other two are being stored.

The diesel engine was originally designed to run on vegetable oil. It does so quite well. You have to heat the oil to get the right consistency but other than that it is plug and play.

I got a bit more creative and built a bio diesel lab in my shed. I made barrels of the stuff. The byproduct is glycerin. Ie, soap.

Burning bio diesel does not create anything harmful. You can actually breathe the exhaust. It smells like French fries.

The power system is carbon neutral. That is, you grow the corn or soy plant, which takes carbon dioxide out of the air. You then burn the bio diesel made from corn or soy oil, and put the carbon dioxide back in again. As long as you keep growing more corn or soy it is a closed system. Carbon neutral.

Jet air craft run on kerosene. #2 diesel. Kerosene is very similar to bio diesel. There is research on using bio diesel to fuel jet engines. It works.

Back to my old vw diesel motors. They all run bio diesel. The world’s best carbon neutral fuel.

Easily produced in very large quantities in Canada, where our Prarie Provinces can produce massive amounts of corn and soy.

We could be a world leader in renewable fuel. Millions of little bio diesel cars driving around, not polluting at all. Fully carbon neutral.

Why aren’t we?

The electric car is a dirty vehicle. Electricity is mostly generated by burning coal. The batteries use things that have to be mined. Cobalt. Lithium. The mines are some of the dirtiest, most carbon dioxide intensive operations around.

A used electric car battery is toxic waste. No one knows how to recycle them. If they all end up getting dumped in auto junk yards and crushed it will be an environmental nightmare.

So why aren’t we all driving around in clean, carbon neutral bio diesel cars?

Is it because you can’t make them self driving?

They don’t need teams of scientists to design?

The engine already exists?

There is no incentive for green energy billionaires to get into this? You can’t get rich producing cheap fuel for an engine that already exists?

Going to make a couple more drums of bio diesel this weekend.

You can never have enough of the stuff….

#129 GRG on 08.25.20 at 11:25 pm

“…CERB ending and government support winding down since Ottawa’s out of cash…”

Anybody tell T2? He loved the adulation that came from the daily dispensations.

No wonder he said taxes won’t be raised. That would sort of spoil the mood, wouldn’t it.

#130 Don Guillermo on 08.26.20 at 12:16 am

#96 Nonplused on 08.25.20 at 8:04 pm
“Immigration has dropped 64% during the pandemic. Let’s hope it restores, since this is a vital economic driver. – Garth”

Well, maybe when the unemployment rate drops. As I have discussed before but not for a while, and it bears repeating, I think the immigration rate should be inversely related to the unemployment rate. Right now about the last thing we need is more unemployed people on government handouts, whether displaced citizens or immigrants that can’t find a job.

Also as technology displaces workers, something that has been happening for a long time but seems to be accelerating, it seems possible that there might come a day when Canada is “full”. In fact that may be rearview mirror stuff. The birth rate has been falling for years, naturally, all on its own. That is the stuff of markets reacting to market conditions

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

For many decades Canada was the envy of the world for it’s immigration policy … and then sometime/somehow in 2015 our Prancing Prince tweeted a fail and we all became racists overnight.

#131 Cowtown Cowboy on 08.26.20 at 12:56 am

#113 And I’m free…free falling on 08.25.20 at 9:07 pm
Kenney says it will be the “biggest deficit in the history of Alberta by a country mile.”

“It will be well north of a $20-billion deficit in large part because of the total collapse of revenues emanating from the coronavirus recession,” he said Tuesday.

Just finished a board meeting with our MLA and it’s looking like $25billion

#132 Jane24 on 08.26.20 at 1:11 am

We are looking for a second home in France too at this point. Looking at Brittany as once Covid ends it is just a ferry ride away from our UK home. Our price range is up to £250,000 or $425,000 Cdn.

For that we are looking at a pool, 5 beds, fully restored 2000 sq ft farmhouse, with a second guest house on one acre of land, walking distance to a village and close to the coast.

In Canada would we even get a one bed condo for that money! Cdn RE prices for nothing are incredibly expensive. Yes indeed as another poster said your prices are the same as Rome, Paris and London with worse weather and higher taxes. Buy in France.

#133 Stoph on 08.26.20 at 1:19 am

#87 Ponzius Pilatus on 08.25.20 at 7:31 pm
Let’s assume that WFH will be permanent.
The question then is, what should/will happen to the windfall that the corporations will reap due to lower operating costs?
Possibilities:
Increase dividends
Increase executive bonuses
Increase salaries
Increase retained earnings
Pay more taxes voluntarily (joking, of course)
Give to charity (again, joking)

Any suggestions?

—————————————————————-

How about outsourcing even more jobs.

No point in paying a North American salary if you don’t need to; there’s plenty of other willing and skilled people in the world.

#134 Nonplused on 08.26.20 at 1:56 am

#103 Mark the Carney, Carney on 08.25.20 at 8:16 pm
#93 Madcat on 08.25.20 at 7:47 pm
This is very scary (see link below). I just took the survey and it seriously sounds like the Bank of Canada is considering negative interest rates. Everyone who frequents this blog has a duty to fill out the survey and scream at the top of their lungs that they want the bank to target inflation. Target inflation.
—————————————————————-

We are facing deflation not inflation, hence why the negative interest rates are coming. Wages are stagnant, half the country is on CERB and up to their ying yangs in debt. The BOC is fearing deflation not inflation.

——————————

Nope, they are not. No fiat currency has ever caused deflation. They are trying to prep us for the inflation to come. It is “for our own good”. Yes, the deflation risk is there and they know it, but don’t expect it to ever last for more than 2 quarters before they are well back on the gas pedal.

Deflation only happens when governments have to borrow and pay the money back in gold, and the gold supply does not keep up. We are about 100 years past that now. Any deflationary period if one should arise will be brief and followed by an inflation that quickly returns prices to that which they were or higher. That is the point of this survey. It is to groom us to think that if the price of say food fell by 10%, rather than that being a good thing because it is more affordable, it should quickly be met with a 12% rise in the price of food. For our own good. Averages out to 2%, the magic number like Pie or e.

#135 Bezengy on 08.26.20 at 7:17 am

#93 Madcat

WTH are they doing? Asking for permission to print money?

btw…whenever I do a survey like this I always make a note telling them that they should read Garth’s blog. I figure the country would be a better place if everyone did.

#136 BillyBob on 08.26.20 at 7:19 am

#124 Ronaldo on 08.25.20 at 9:55 pm
Companies will realize that production will begin to increase as they go totally WFH. No more chit chatting around the water cooler about the low interest rate you got to buy that 1.5 million dollar condo or last nights hockey game, etc. etc. etc.

WFH will become so productive that WFHers will work themselves out of a job and the company will put them on part time working half days at half rate.

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

Uhhh…yeahhhh. No idle chit-chatting in the home office, because there’s no way to communicate on every form of social media and a million family distractions at home.

Maybe WFH is more productive, maybe it isn’t, but to suggest that removing the office water cooler to replace it with kids, Facebook, and your own fridge somehow improves focus is ridiculous.

I guess maybe you were being sarcastic but with it’s hard to tell these days.

#137 BillyBob on 08.26.20 at 7:30 am

#25 the Jaguar on 08.25.20 at 4:11 pm
It would be reasonable to think that as time and human society evolved people would have transformed into better and improved versions of themselves. Unfortunately not the case. Social graces have been on a steep decline for about 20 years, with meaningful communication downgraded to text message, Facebook exchanges, and strident social media outbursts.
The ability to think through serious issues, take an appropriate response while bearing in mind the consequences of actions to ourselves and others is disappearing like a fart in a hurricane. It’s becoming akin to teaching cursive writing skills in the school curiculum. It’s not viewed as relevant. It doesn’t register on the radar of the brainless at all. We’ll see how that works out when the fragile electrical grid fails us.
That unfortunate mode of thinking also lends itself very well to consumerism, which is what housing has become. It’s not shelter for oneself and the family anymore. It’s some brutish, bizarre little game of ‘on line poker’ using houses. Never has the phrase ‘Be careful what you wish for, you may get it’, been so timely.

As for Evan Siddall being a ‘cowboy’, we attach great value and admiration to that word and those who have the chops to embody what it stands for here in the great city of Calgary. I might put forward Evan Siddall’s name for Grand Marshall of the Calgary Stampede Parade in 2021. He’s certainly earned it and my admiration.

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

Excellent comments as usual Jag, couldn’t agree more about Siddall. It’s sad the likes of him are so rare now.

I’m sure Alberta will emerge from the other side of this mess with more strength eventually than any other part of Canada. Not in spite of their massive challenges, but because of them. Resilience and adaptability are hallmarks of people who know how to “cowboy up”, not posers who endlessly cry for their government to save them.

Oh and after watching “Greyhound” wanted to learn a bit more about the WWII Atlantic supply lines and picked up a copy of a book you recommended awhile back, “At All Costs”.

Enjoying it a lot, so thank you!

#138 the Jaguar on 08.26.20 at 7:57 am

@#138 BillyBob on 08.26.20 at 7:30 am

Operation Pedestal is an interesting story of bravery in many ways, not the least on the part of the people of Malta. Visited there twice and enjoyed it immensely.

You’ve got me a little choked up about Alberta. I may take off on a little road trip now to the south country. Pack a little cucumber and brie sandwich, hop in the VW with the windows down and Sinatra playing and go pay my respects to Big Chief Mountain. The Alberta coulees are restorative.

#139 Mark the Carney, Carney on 08.26.20 at 7:59 am

#135 Nonplused on 08.26.20 at 1:56 am
#103 Mark the Carney, Carney on 08.25.20 at 8:16 pm
#93 Madcat on 08.25.20 at 7:47 pm
This is very scary (see link below). I just took the survey and it seriously sounds like the Bank of Canada is considering negative interest rates. Everyone who frequents this blog has a duty to fill out the survey and scream at the top of their lungs that they want the bank to target inflation. Target inflation.
—————————————————————-

We are facing deflation not inflation, hence why the negative interest rates are coming. Wages are stagnant, half the country is on CERB and up to their ying yangs in debt. The BOC is fearing deflation not inflation.

——————————

Nope, they are not. No fiat currency has ever caused deflation.
————————————————————–

Au contraire mon ami. The USA went off the gold standard when the Federal Reserve was created in 1913. It allowed convertibility into gold on and off until 1971 when it ended this practice. This however ws not the gold standard, the Fed could expand the fiat money supply from day 1 without regards to the gold supply.
Europe and England ditched the gold standard during WW1. I state this because guess what happened during the Great Depression? Massive deflation, the likes we had never seen and NO GOLD STANDARD. Ever heard of a country named Japan? They have been battling deflation for decades and NO GOLD STANDARD.

https://www.bnnbloomberg.ca/japan-s-long-deflation-battle-is-warning-for-post-virus-world-1.1442539

https://www.thebalance.com/what-is-the-history-of-the-gold-standard-3306136

#140 Einstein on 08.26.20 at 8:03 am

#126 Elementary, my dear Watson on 08.25.20 at 10:03 pm
#1 Overheardyou on 08.25.20 at 2:51 pm

This really makes one wonder, how much supply must increase to make a noticeable decline in demand and therefore prices? Are there any stats that could provide a valid estimate?

——————————————————————

This should do it …

ρ = [ 1 / N ] * Σ { [ (Xi – μX) / σx ] * [ (Yi – μY) / σy ] }
—————————————————————-

You can close but forgot to square it…

#141 Uncle Al Sinclair on 08.26.20 at 8:14 am

#110 Blacksheep on 08.25.20 at 8:54 pm
Uncle # 97,

“Of course we see it.”

“Now stop griping and go out and get yourself a $1.5 million dollar mortgage for a garden shed in Leslieville.”
—————————–
Good to hear you covered.

But who’s griping?

Just making a counter comment to today’s message after learning the hard way by selling my primary res, in the summer of 2008, 6 months before RE started to rise again, after heavy Gov interventions.

Fool me once…
—————————————————————

Feel sorry for anyone who sold out way back then especially on a primary residence with its cap gains exemption. The problem today is that you have had 12 years of price increases as a starting point for someone just entering the market. This wasn’t the case in 2008 when house prices were still somewhat sane even in the GTA. 2008 wasn’t preceded by a 12 year run up like we have now…

#142 willworkforpickles on 08.26.20 at 8:16 am

They used to say QE to infinity. Little did we know then how much they really meant it.
QE worked to keep int. rates down over the last decade through times of low unemployment and high productivity/GDP.
That’s about all it did in so creating the market and RE gasbags we have now…and the rich got richer.
With the pandemic that brought on persisting high unemployment that exists now, QE infusions have become inflationary over the lack of productivity.
As long as unemployment stays high and productivity remains low…pray that inflation doesn’t get too out of control.
The longer this pandemic goes on, unemployment remains high, production stays low, the more of an inflation threat through QE infusions there will be.
More and more QE…low productivity = Inflation and more Inflation.
Eventually Int. rates will have to go up to fight rising inflation.
This is the new QE reality. The QE difference now over the QE of the last decade in regard to the threat of rising interest rates to come.

#143 JonBoy on 08.26.20 at 8:39 am

#133 Jane24 on 08.26.20 at 1:11 am
We are looking for a second home in France too at this point. Looking at Brittany as once Covid ends it is just a ferry ride away from our UK home. Our price range is up to £250,000 or $425,000 Cdn.

For that we are looking at a pool, 5 beds, fully restored 2000 sq ft farmhouse, with a second guest house on one acre of land, walking distance to a village and close to the coast.

In Canada would we even get a one bed condo for that money! Cdn RE prices for nothing are incredibly expensive. Yes indeed as another poster said your prices are the same as Rome, Paris and London with worse weather and higher taxes. Buy in France.

—–

You seem to think Canada is a one- or two-city country.

$425K will get you a relative mansion in many parts of Canada, especially the East Coast.

We just picked up a nearly new bungalow for $440K on 1/3 acre, 3200 sq ft, 4 bedrooms, 3 baths, with ocean view. I don’t have to speak French to live there, either…

The house you describe is not a place where you can actually live AND work, for most people. It’s a retirement-type property for people that are independently wealthy, retired or self-employed and don’t need to be close to a typical urban center to generate/meet clients, etc. To pretend it is somehow comparable to a place in Toronto or Vancouver (or any other capital city in Canada) is nonsensical.

#144 Grandpa Walton on 08.26.20 at 8:46 am

#144 JonBoy on 08.26.20 at 8:39 am
#133 Jane24 on 08.26.20 at 1:11 am
We are looking for a second home in France too at this point. Looking at Brittany as once Covid ends it is just a ferry ride away from our UK home. Our price range is up to £250,000 or $425,000 Cdn.

For that we are looking at a pool, 5 beds, fully restored 2000 sq ft farmhouse, with a second guest house on one acre of land, walking distance to a village and close to the coast.

In Canada would we even get a one bed condo for that money! Cdn RE prices for nothing are incredibly expensive. Yes indeed as another poster said your prices are the same as Rome, Paris and London with worse weather and higher taxes. Buy in France.

—–

You seem to think Canada is a one- or two-city country.

$425K will get you a relative mansion in many parts of Canada, especially the East Coast.

We just picked up a nearly new bungalow for $440K on 1/3 acre, 3200 sq ft, 4 bedrooms, 3 baths, with ocean view. I don’t have to speak French to live there, either…
—————————————————————

Well done Jonboy! Sounds like a fabulous home and an ocean view to boot! I am jealous. Any chance of having the blog dog xmas party there? Captain Garth could make an appearance with it being on the east coast…

#145 ImGonnaBeSick on 08.26.20 at 8:54 am

#129 Ace Goodheart on 08.25.20 at 11:16 pm
Watching as the world pivots towards the next dirty source of mobility for the masses: the electric car.

When I was younger, I had a lot of old diesel vws.

I still have three of the engines. One is in a 1986 westfalia camper that I rebuilt. The other two are being stored.

The diesel engine was originally designed to run on vegetable oil. It does so quite well. You have to heat the oil to get the right consistency but other than that it is plug and play.

I got a bit more creative and built a bio diesel lab in my shed. I made barrels of the stuff. The byproduct is glycerin. Ie, soap.

—–
I love this. In my younger days, I was an avid study in alternative fuel sources, green technologies, and autonomous living.

Reverend Diesel and the diesel engine is a fascinating story, which I would encourage anyone to research. Another thing, if you use rape seed (ie. Canola) the product from 1 acre is greater than the input energy required to grow and harvest. A net positive. The issues are several however, 1) it gels in cold weather, 2) it does not store long without additives, and 3) it replaces what would be food sources with fuel source. There were some amazing studied using algae to create diesels, and I’ll have to look again if this research has continued.

Ethanol is another alternative fuel that can be acute carbon neutral as well. From what I understand, sugarcane in tropical zones and sugar beet in temperate. But again, you’re replacing food sources with fuel sources in a world with 7.8b people…

I always liked hydrogen until they wanted to use methanol as the fuel source and then it just seemed like a vanity project. It requires a lot of energy to split hydrogen from oxygen, but it’s not overly complex and it’s a bit dangerous to handle – all could be overcome with a bit of engineering…

#146 Uncle Al Sinclair on 08.26.20 at 8:59 am

#128 JoinEm on 08.25.20 at 10:55 pm
We bought a condo in Edmonton in 2015 for $324 000. We got a pretty good price on it. The previous owner had paid $322 000 in 2009. We just sold it for $304 000, and we consider ourselves lucky.
——————————————————————
Wow! Since 2009, 11 years, this condo has gone up a mere $18k… It is hard for someone in the GTA to wrap their mind around this.

#147 Re elect no one on 08.26.20 at 9:12 am

Please Canadian voters get rid of the ideologues (Butts, Telford, Freeland, Hadju et al).


No choice, everyone-end a message to any sitting NDPs
– this is your last term if you prop up the Liberal criminals

#148 Dharma Bum on 08.26.20 at 9:32 am

Everything is changing.

Masks are the new condoms.

Debt is the new wealth.

CERB is the new work.

Trans is the new straight.

Fentanyl is the new beer.

Weed is the new candy.

Fear is the new calm.

WFH is the new wasting your employer’s time.

Ignorance is the new intelligence.

Stupid is still stupid. We’re pooched.

#149 Do we have all the facts on 08.26.20 at 9:32 am

#. 56 Shawn

What else do you think our Federal government could do to support housing other than to increase the financial assistance offered to first time home buyers?

Interest rates have reached their basal limit.

There is no longer any shortage of mortgage funding so buying more mortgage backed securities and packaging them within Canada Mortgage Bonds and then having the Bank of Canada buy the Bonds in the secondary market will not stimulate additional demand.

Extending the amortization period from 25 years to 40 years for insured mortgages was introduced in 2006, reduced to 35 years in 2008, reduced to 30 years in 2011 and returned to 25 years in 2012. CMHC determined that all a longer amortization period did was to substantially increase the total interest paid by the borrower.

The credit score threshold for obtaining an insured mortgage was set 620 in 2008 and increased to 680 in 2012. In 2016 the credit score threshold was lowered to 600 in the hope of stimulating demand. In 2020 CMHC became concerned that many Canadian homeowners had become overextended and decided to reestablish a credit score threshold of 680 for at least one member of a household. Little chance that a responsible government would decide to lower the credit score threshold based on past experience.

Reducing the down payment required to zero was tried in 2006 but the financial crisis in 2008 put a quick end to the idea. A number of lenders created a “cash back” program that used a separate loan to provide the down payment. This practice effectively ended in 2012 when most loans could not be included in a downpayment. The door was finally closed in 2020 when no form of loan could be included in a down payment. The 5% minimum downpayment is unlikely to be reduced in the future

In 2012 the Gross Debt Service Ratio (GDS) was set a 39% of gross household income and the Total Debt Service Ratio (TDS) was set at 44% of gross household income. In June 2020 the GDS was reduced to 35% and the TDS reduced to 42%. Further reductions by government would be irresponsible.

I could go on but my point is that the traditional stimulus toolbox is getting pretty bare and without government stimulus it seems probable that the a decline in demand will cause average house prices to fall.

If you have a possible stimulus in mind I am listening!

#150 Dharma Bum on 08.26.20 at 9:37 am

#145 Grandpa Walton

Well done Jonboy! Sounds like a fabulous home and an ocean view to boot! I am jealous. Any chance of having the blog dog xmas party there? Captain Garth could make an appearance with it being on the east coast…
——————————————————————-

Yes!

I will trailer in my smoker and grills, and rustle up some serious barbecue and fixin’s for all the blog dogs!

Sounds great. I needed something to look forward to!

#151 Mattl on 08.26.20 at 9:50 am

#43 Tater on 08.25.20 at 4:51 pm
Bigland forgets to mention that you paid about 40k in interest cost in that 3 years. So what’s the profit again??

—————————————————————

And depending on where you are, land transfer taxes. That seller is way underwater on the sale.

#152 Captain Uppa on 08.26.20 at 10:14 am

Mark Carney joins Brookfield to lead firm’s expansion into ESG funds (environmental and socially sustainable ETFs).

Trudeau to announce his grand new plan with Freeland at the helm.

Put two and two together. Get ready for the Canadian Green New Deal.

#153 Blacksheep on 08.26.20 at 11:05 am

Uncle # 142,

“Feel sorry for anyone who sold out way back then especially on a primary residence with its cap gains exemption.”
———————————–
Owned three RE locals from 1991 to 2008 when we sold and put the funds into Gold / Silver bullion. Dec 2013 we re entered the RE market. The house value has since risen 2.4 times the original purchase price.

Fortunately PM’s saved my ass, but it could have gone another way, easily. I have shared this tale here a couple times now, the takeaway I learned is:

*Align your investments with whatever is in the best interest of the systems managers (politicos) and they will do the rest*

#154 JB CONDO DEATH on 08.26.20 at 11:10 am

#61 YouKnowWho on 08.25.20 at 5:36 pm

#7 JB CONDO DEATH

__________________________

Really? You think the health care pros are such experts with PPE?

“In yet another study from last year, researchers in Chicago observed healthcare workers taking off their person protective equipment (masks, gloves, gowns, etc)—the removal is called doffing. This is a time when healthcare workers can easily self-contaminate by taking gear off incorrectly. The researchers found that healthcare workers incorrectly removed their protective gear 90 percent of the time.”

https://arstechnica.com/science/2020/04/should-you-wear-a-face-mask-heres-all-the-data-we-have/
…………………………………………………………………..
Thanks for clarifying why the United States still is number one in COVID deaths, number of cases and why proper PPE is so important. At my wife’s hospital they take PPE very seriously and as someone commented that she was a hypochondriac, well they are simply misguided and not informed. She is a nurse so hypochondria and nursing don’t mesh well. We are not out of the woods here yet but in comparison to the good old USA we are in a much better place. My point was that some people are very nonchalant about wearing PPE especially where there is high density.

#155 cto on 08.26.20 at 12:17 pm

The FED
“5 more years of 0% interest rates”….imagine that, they actually came right out and said it today…Wow! just Wow!
I’m very concerned for my 10 year old!!!

Actually the Fed made no such statement. It may or may not come to pass, but it is unstated. – Garth

#156 TurnerNation on 08.26.20 at 12:21 pm

Walking into your local grocery store, confronted by Plexiglass Turrets. Occupied by masked, faceless soldiers armed with (spray) guns. You are the target. We are the enemy. The mind control is complete in this WW3.
The destruction of Western 1st world culture was the goal.
How you work, play, assemble, what you wear, shop, travel, invest. All turned into CHAOS.

WW2 was more subtle. As per Wikipedia the ‘British’ royal family changed their German surname to a more media-friendly anglo one leading up and after WW1 “The war to end all wars” (Flip that statement 180 degrees to make sense as usual) . You know it would have looked bad, harder to sell the next war. This time they’re not even hiding it. Total control has been achieved.
https://en.wikipedia.org/wiki/House_of_Windsor
“In 1917, the name of the royal house was changed from the German Saxe-Coburg and Gotha to the English Windsor (from Windsor Castle) because of anti-German sentiment in the United Kingdom during World War I.[“

#157 Don Guillermo on 08.26.20 at 12:57 pm

#127 Mosey on 08.25.20 at 10:03 pm

One factor you missed, Garth, is the astonishing number of Canadians who have lived and worked abroad who are now returning home (with spouses and kids in many cases). We just arrived in the Kootenays from the states. There are no rentals available anywhere in the region and home prices are very high

***************************************
Try looking in West Trail. Very affordable. I was raised in a house very close to this one, No where near as big or fancy. We sold it for $30 K about 15 years ago when my parents went into a seniors home. The view of the Columbia river is beautiful. If they had just swung the camera around 270 deg to the left you’d see a full view of the lead//zinc smelter.

https://www.redfin.ca/bc/trail/1344-Green-Ave-V1R-4K1/home/154698600

#158 Sara on 08.26.20 at 1:27 pm

Preferred share etfs are on fire today. DXP up over 2%.

#159 Linda on 08.26.20 at 1:35 pm

#113 ‘Free’ – yet that revenue strapped Alberta government was able to 1) invest 1.5 billion in a pipeline; 2) guarantee the construction of said pipeline by another 6 billion dollars; 3) cut business taxes, further reducing revenue. All during the downturn of the Alberta economy. That 20 billion dollar deficit is at least in part due to those economic ‘actions’, which weirdly enough have not resulted in any immediate economic benefit to Albertans. In the case of the business tax cut, one well known oil & gas firm promptly closed headquarters in Alberta & moved to the USA – AFTER collecting their little golden handshake. To be fair, that isn’t the first time various levels of Canadian government have handed out large sums of public money to companies to ‘retain jobs in Canada’, only to see those firms shutter the shop post largesse. You’d think we’d have learned from previous experience, but no. Of course, it all depends on just what you intend to purchase when that largesse is being handed out. Funny how so many prior politicians find work with those self same firms later on in life…..

#160 YouKnowWho on 08.26.20 at 2:10 pm

TurnerNation

That always makes me laugh, how inbred and German the “British” Royals are, makes me feel bad for those two girls they recruited recently for some genetic diversity. Since the boys were 50% not royal blood due to Diana, these new ones are 25% Royal blood only!

The Brits are ruled by Ze Germans, and let us not kid ourselves, who owns all of Canada’s land? Not like we’re exempt or special here.

Hilarious that people pay $2m for a leasehold on the Queen’s land and think they own it…just to keep a box to store all their crap in. When broken down to basics it’s silly and so is the pursuit. Spend your life in debt to have a box for your clothes, collection of comics and whatever other nonsense is keep in the garage where a car should go. Then weap about the tragedy of death when you dedicated your life to worship of money or real estate.

Well done. Reflect about this success on the death bed. Think how much of your life that detached house ate up. Wish you had it back now, don’t you? Can’t.

#161 Brett in Calgary on 08.26.20 at 2:10 pm

#159 Sara on 08.26.20 at 1:27 pm
Preferred share etfs are on fire today. DXP up over 2%.
———

Yep I am digging it! Good time to be overweight in prefs.

#162 AGuyInVancouver on 08.26.20 at 2:40 pm

Siddall is the only voice of sanity. Conservatives, Liberals and the Bank of Canada have all desperately tried to keep the housing party going, no matter what the cost. Sad.

#163 JoinEm on 08.26.20 at 2:42 pm

#147 Uncle Al Sinclair

Over the last 11 years the condo in Edmonton has gone down almost $20 000… I don’t know when peak prices were. 2008?

#164 Regis coke smuggler on 08.26.20 at 2:46 pm

DELETED

#165 willworkforpickles on 08.26.20 at 3:01 pm

#156 cto
If unemployment remains high and likely will through 2021, they will print a great deal of money (to pay out Ei in Can. and support in the US) pushing up inflation. Too much and they have been known to increase interest rates to push it back down.

#166 Stan Brooks on 08.26.20 at 3:02 pm

High house prices in a bankrupt place with no real economy does no make any sense.

This is not an investment.

The ability to over leverage based on the exceptional stupidity of the crowd is limited.

You can not make paint out of a fart. You can try but you will fail.

Watching in real time the destruction of the ‘loonie’ is surreal, but fulfilling.

What kind of idiots can trust the socks boy and his ‘green’ finance minister is beyond me but it is kind of funny to watch the exceptionally stupid lead by 2 dummkopfs with combined IQ 1/3 of mine.

Cheers,

#167 willworkforpickles on 08.26.20 at 3:08 pm

Like i said before…QE is a different animal now with high unemployment in comparison to the QE of pre covid days/years.

#168 Ronaldo on 08.26.20 at 3:27 pm

#164 JoinEm on 08.26.20 at 2:42 pm
#147 Uncle Al Sinclair

Over the last 11 years the condo in Edmonton has gone down almost $20 000… I don’t know when peak prices were. 2008?
———————————-
May 07 as I recall.

#169 Smaralox on 08.26.20 at 3:33 pm

Why we buy?

Well, after a decade of renting, I am qualified to answer that question, having just bought a house.

Working from home during the pandemic was not sustainable. I can self-isolate in my office at work, but working from my current home, I spent my day standing with my laptop balanced on top of my dresser in my bedroom, while my wife worked from the fold-out dining room table in the living-dining room. We battled constantly for 1.0Mbps of bandwidth, along with our child, doing online learning (read online ‘gaming’) while we struggled to keep his attention and focus on our own work.

We watched as one of my wife’s colleagues lost her battle with cancer in early April, and her adult children struggled in the middle of a global travel ban, to make it to Vancouver, and see their mother and grandmother one last time.

We felt powerless as our extended family lost another member (the second in less than two years, out of a family of five, a young person, in their early 20s) in Atlanta, while the US remained off limits to travel.

We worried about our elderly parents, living alone, well and truly isolated from friends and family during the pandemic.

So we decided to put our plan to move closer to family in action, at the first opportunity.

We kept our Vancouver jobs, since working remotely means literally anywhere, as long as you can participate online. My boss at my Vancouver job lives in Maple Ridge, and has not been in the office since March 13, reveling in having avoided his 3h/day commute.

We bought a house. Close to our elder, but still active parents, who are now able to bubble with their only grandchild.

Looked for enough space, in good condition, most major expenses already addressed. Fought for a good price.
– Put 20% down (no CMHC), but only 12% of our net worth.
– Got a mortgage for 2.4 times our annual salaries,
– monthly payments are about 13% of disposable income.
– 1.5x what we paid in rent, for 3.5x the space.

So there you go. Ours is not the typical reason for ‘why they buy’ or the typical approach. But we feel good about our decisions, our reasoning, and our position, thanks to Garth and the blog.

#170 YouKnowWho on 08.26.20 at 3:44 pm

#170 Smaralox

…and when Covid ends and you have to go back to the Vancouver office?

Then what?

#171 maxx on 08.26.20 at 4:33 pm

@ #32

SSDD….but at least the income from these Frankenrentals might be easier to track so that TAXES are paid.

#172 Don Guillermo on 08.27.20 at 12:57 am

#140 the Jaguar on 08.26.20 at 7:57 am
@#138 BillyBob on 08.26.20 at 7:30 am

Operation Pedestal is an interesting story of bravery in many ways, not the least on the part of the people of Malta. Visited there twice and enjoyed it immensely.

You’ve got me a little choked up about Alberta. I may take off on a little road trip now to the south country. Pack a little cucumber and brie sandwich, hop in the VW with the windows down and Sinatra playing and go pay my respects to Big Chief Mountain. The Alberta coulees are restorative

********************************
Hey Jag, thanks for the thumbs up the other day. I moved to Calgary from the GTA 32 years ago and was born and raised in BC. I am a very proud Albertan and always will be. Spent a month on the Costa del Sol in the 80’s but never been to Malta. Travelling is great.