Nesting

Ottawa. Victoria. Niagara. Kelowna. Montreal, Toronto and Vancouver. Mississauga, Burnaby, Etobicoke, Abby and PoCo. It’s the same story everywhere. House sales exploded in July and August. Prices have risen to meet demand, since inventory levels in most markets were at a Covid low.

Logically, this is nuts. Unemployment in Canada is north of 10%. In centres like the GTA, a lot worse. Millions remain on government pogey and hundreds of thousands have been unable to pay existing mortgages. Small shops, restaurants and factories have been whacked and many will never reopen. Tourism is dead. So are conventions, sports and travel. The country’s in the midst of the worst recession since the 1930s. Nine thousand people have died of a contagious virus for which we have no cure. Social distancing and masks have crucified retail and are destroying eateries. Downtown cores are dusty wastelands. Schools have been shut for six months. Airport passenger levels are down 90%.

And yet, a real estate feeding frenzy. Debt levels are surging. Bidding wars, blind auctions, bully offers and people grabbing houses they’ve only Zoomed or FaceTimed. It’s all happening. It’s real. It defies reason.

And it’s not just isolated, a unique Canadian affliction. Check out these headlines from my daily feed:

Why the Indiana housing market remains so hot during the pandemic
The Indianapolis Star
New Yorkers are Fleeing to the Suburbs. ‘The demand is insane’
The New York Times
Hot Property newsletter: Hot times in the real estate market
Los Angeles Times
Why residential real estate is becoming more attractive in the suburbs
Montgomery County Paper
Real estate market soars despite pandemic
Roanoke Times
Real estate sales reaching lofty heights
The Anna Maria Island Sun
Why residential real estate in South Bay is red hot despite the pandemic’
San Jose Spotlight
Act fast to land a home in today’s market
Orange County Register
Expert: Panic buying hits Denver housing market
Westword
Housing market continues to soar in southwest Michigan
ABC 57 News
Portland broker see rebound in housing market during pandemic
KGW.com
Millennials help power this year’s housing-market rebound
Wall Street Journal
Record sales, record prices in Colorado’s real estate market’
9news.com KUSA
.

If we can understand why this is happening, perhaps we can determine if it’ll last. Knowing that could answer this question: are today’s virus buyers savvy or senseless?

The obvious first reason houses are going up is that interest rates have come down. Cheap mortgages allow folks to borrow more, spend more, and squeeze prices higher. Second, we had no spring market. It was lockdown time, so pent-up demand exploded like a sailor on shore leave. Third, demographics have been pushing real estate. The largest cohort in society are the Millennials, all 9.8 million of them. That’s 27% of the population, and they’re all horny. For houses.

But those are just the reasonable reasons. There are a slew of unreasonable ones, too. They have to go with a certain global pandemic. Maybe you heard.

Covid has infected millions of brains, inserting fear and a sense of victimization. In a scary, out-of-control world which is beyond the experience of anyone alive, people are seeking shelter, refuge, safety and all the predictability they can get. Nesting. Cocooning. Owning a home seems like gaining control over your own surroundings and destiny. In the fog of emotion it seems if you lost your job, or society continued to unravel, you’d be better off as an owner than a renter who could be turfed. Of course that ignores the far higher costs of owning than leasing, but this is no time for logic.

Then there’s the direct virus impact. Millions are working remotely, so the dwelling becomes their world, 24/7 & 365/yr. They want more space from kids and spouse. The office downtown is shut now and may be for a year. So they can move to the burbs or a small hinterland city and finance more house. Meanwhile fear of germs, strangers in the hallway, sticky elevator buttons and scary garbage rooms have fueled a flight from high-rise condos into low-rise semis, towns and detacheds.

Layer on this a thick coating of financial illiteracy. Most people have no liquid investments, have never invested, think the stock market is a casino and only know their parents made a fortune on a house they bought in 1978. So what if they need a $1 million mortgage now? Nobody actually expects it off since you’re renting money as you move up the property ladder with equity the market hands you. every year.

Lastly, all of the above has created FOMO. Fear of missing out. It’s a huge driver of the emotions which lead people to take irrational actions. Toronto agent Steven Fudge has written about this convincingly:

Fear evokes a visceral reaction, which focuses entirely on the moment (fight or flight). FOMO has incredible strength and ability to separate people from their logical assessment of a property. Things like budget, property inspection and even the concept of debt are pushed directly to the side as the homebuyer focuses on the task at hand and is willing to do what it takes to secure a purchase.

As a result, in the midst of a pandemic and the worst downtown in our lives, house prices have peaked and household debt is soaring when rates are at an historic low and can only increase. What could possibly go wrong?

       

Well, the mortgage deferrals are done. No more. Now we get to understand the consequences.

Earlier today the federal regulator dropped the hammer, telling banks any new deferrals they grant will be treated as non-performing loans, requiring them to raise more capital. In effect, it signals the end of a six-month period in which almost 800,000 families stopped paying their obligations.

The program will be phased out over the next 90 days with the bulk of deferrals ending next month. “Banks are now in a better position to employ their business-as-usual alternatives to support troubled borrowers,” the regulator said. In general that means moaning and weeping.

It’s begun.

161 comments ↓

#1 NSNG on 08.31.20 at 3:16 pm

For MMT to work it requires politicians to show restraint during times of runaway inflation.

OUR POLITICIANS? Are people that stupid?

BAHAHAHAHAHAHA!

Just take five minutes and get a good hard look at the Fed if you want to see what political restraint during times of crisis looks like.

#2 crowdedelevatorfartz on 08.31.20 at 3:20 pm

I was in South Surrey yesterday morning.
I have never seen so many For Sale signs….. no Sold signs.

#3 Andrewski on 08.31.20 at 3:23 pm

The markets seem to be ready for a Biden win, as they keep going up, even though it makes little sense. Might be a wild ride coming for the rest of 2020?

#4 ElGatoNerodeYVR on 08.31.20 at 3:28 pm

It’s all good ,history teaches us that the government will support housing.
If we think there is a tide of defaults, It will simply buyout the underwater mortgages to make the banks whole and the owners will stay as renters paying the previous principal mortgage payments only as rent.
Otherwise known as partial nationalization of the housing stock since we haven’t really build social housing.
There ya go ,problem solved ,why worry …..

#5 Puzni on 08.31.20 at 3:28 pm

Hi Garth, There is also another reason why houses are flying off the market. When COVID ends a lot of employers will be looking for efficiencies and will ask employees to work from home. With current tax regulation allowing a deduction of up to 30% of office home use and all expenses( with the right signed form) why wouldn’t houses appreciate. All of a sudden you get a deduction for office use at home. Also commercial real estate office rates will be under pressure for foreseeable future. Cheap interest rates , government deductions and higher possible inflation in years to come almost is a guarantee that house prices will go up not down. It’s a perfect storm.

#6 crowdedelevatorfartz on 08.31.20 at 3:28 pm

@#188 Faron

“This wedge will spread to Canada given a bit more time if the media landscape is allowed to degrade and if these radically erroneous voices are given a stage.”

+++

I guess you don’t live in Montreal, or Toronto or Vancouver.
The Sheeple have been busy defacing and vandalizing everything “they” find offensive.

Perhaps the Right should have another telethon to raise money …
We’ll call it.
Tear Gas is not enough….

#7 KNOW IT ALL on 08.31.20 at 3:32 pm

STAY in CASH….. and WAIT for the CRASH!!

Cuz here it comes…….

Properties will be selling for 50 cents on the dollar.

#8 Don Guillermo on 08.31.20 at 3:33 pm

Wise words from CS Lewis

Here’s what he said in 1948 about the mental shift required by living with the threat of the atomic bomb: “We think a great deal too much of the atomic bomb. “How are we to live in an atomic age?”

I am tempted to reply: “Why, as you would have lived in the sixteenth century when the plague visited London almost every year, or as you would have lived in a Viking age when raiders from Scandinavia might land and cut your throat any night; or indeed, as you are already living in an age of cancer, an age of syphilis, an age of paralysis, an age of air raids, an age of railway accidents, an age of motor accidents.”

In other words, do not let us begin by exaggerating the novelty of our situation. Believe me, dear sir or madam, you and all whom you love were already sentenced to death before the atomic bomb was invented: and quite a high percentage of us were going to die in unpleasant ways. We had, indeed, one very great advantage over our ancestors—anesthetics; but we have that still.

It is perfectly ridiculous to go about whimpering and drawing long faces because the scientists have added one more chance of painful and premature death to a world which already bristled with such chances and in which death itself was not a chance at all, but a certainty. This is the first point to be made: and the first action to be taken is to pull ourselves together.

If we are all going to be destroyed by an atomic bomb, let that bomb when it comes find us doing sensible and human things—praying, working, teaching, reading, listening to music, bathing the children, playing tennis, chatting to our friends over a pint and a game of darts—not huddled together like frightened sheep and thinking about bombs. They may break our bodies (a microbe can do that) but they need not dominate our minds.” — “On Living in an Atomic Age” (1948)

#9 Legal Beagle on 08.31.20 at 3:36 pm

@turnernation – I saw the below article and immediately thought to myself you’d like this… fits with the “we’re all farm animals” argument to a tee

https://www.rcinet.ca/en/2020/08/31/what-are-stock-tanks-seems-theyre-the-new-cool-pool/

#10 ElGatoNerodeYVR on 08.31.20 at 3:38 pm

crowdedelevatorfartz on 08.31.20 at 3:20 pm
I was in South Surrey yesterday morning.
I have never seen so many For Sale signs….. no Sold signs.
=============
Yup,shopping around there and prices are quite high ,no COVID discount so anything decent around 1.8 mil.
Now try Cloverdale and it is a different story(barely any listings). My anectodical observation has been that anything over 1.2 mil is hardly moving, while over 1.5 even less. 1 to 1.2 is the sweet spot in Surrey ,1.5 in South Surrey.

#11 Grandv!ew on 08.31.20 at 3:39 pm

The worst case scenario arrives….

https://t.co/vLjukL4CBq?amp=1

#12 Linda on 08.31.20 at 3:47 pm

I read that the bank regulator did put the kibosh on extending mortgage deferrals past 6 months for those who already have one, but anyone applying September 1 through October 31 might qualify for an additional 3 month extension. Can’t imagine the banks/mortgage companies will be rushing to approve any such applications though. I also read that OSFI was going to permit pension transfers to resume, but the article didn’t say exactly when that might occur. Note that the article mentioned pension portability between employers but didn’t say anything about pension commuting.

#13 akashic record on 08.31.20 at 3:50 pm

Watch when the 800,000 families start to demonstrate on the streets all over the country and organize into a political force.

#14 Boombust on 08.31.20 at 3:53 pm

I’m not quite sure what you’re “on” about re: “exploding sales” happening here in the GVRD, Garth.

For the selling period March-August (inclusive) REBGV sales are a mere 6% higher than last year. Guess what? Sales last year for the same period were the lowest in 20 years.

Check out the Fraser Valley and the burbs. – Garth

#15 BillyBob on 08.31.20 at 3:57 pm

#5 Puzni on 08.31.20 at 3:28 pm
Hi Garth, There is also another reason why houses are flying off the market. When COVID ends a lot of employers will be looking for efficiencies and will ask employees to work from home. With current tax regulation allowing a deduction of up to 30% of office home use and all expenses( with the right signed form) why wouldn’t houses appreciate. All of a sudden you get a deduction for office use at home. Also commercial real estate office rates will be under pressure for foreseeable future. Cheap interest rates , government deductions and higher possible inflation in years to come almost is a guarantee that house prices will go up not down. It’s a perfect storm.

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

Yes. Sure. Joe and Jane Public sit down and rationally consider the tax advantages of WFH and it has serious weight in their home buying decision.

Gimme a break. The average homebuyer these days can barely fog a mirror. It’s fear and loathing, as our host says.

Always the best context for making decisions with lifelong consequences lol.

#16 Linda on 08.31.20 at 3:57 pm

Oops, my bad. Possible deferred mortgage granted between September 1 to the 30th may be extended for an additional 3 months, not to the end of October as I stated in my earlier post.

#17 Joe wong on 08.31.20 at 4:09 pm

About time OSFI ended this insanity. Now for Bank of Canada to stop buying up all the mortgage bonds.

#18 paulo on 08.31.20 at 4:10 pm

#5 Punzi

Unfortunately the employees and contractors will also be facing declines in compensation as companies look to remain competitive and will no longer have to pay premium in consideration of onerously high GTA real estate costs that in the end make them and there employees un competitive

#19 Doug t on 08.31.20 at 4:10 pm

Reap what you sow

#20 YouKnowWho on 08.31.20 at 4:14 pm

#187 MF

There has actually been a good deal of information sharing going on here that is very valid, audited, scientific, researched. I’m glad Garth has allowed it. I think he’s learned some stuff too MODing the comments.

I can tell you many things have been learned by many people about the virus on here with info shared. I certainly have. Strangely, often this is a better more sober place to get data and info than official news channels that drive fear and exaggeration in 1 minute news bits with no actual reporting.

Questions have been asked on here to make a person think about the situation clearly.

Your statement shows you perhaps didn’t think your point through.

Yes, your heart has to stop for you to die. Clearly those darn hearts have a defined range of beats before failure. You can increase your odds of going to the higher end of the range, or you can certainly stress that thing to a much lower range of total lifetime beats.

The CDC data point makes a clear statement. Covid alone is not likely to kill you. But it does pick out the weak and the old and it is in full season on those with pre-existing conditions. Also, as a side bar, it maybe exposing what we’ve heard about Americans and obesity and diabetes in general.

I noted this already a number of times about nature – she’s really quite matter a fact on this point. Wind storms break off weak branches and weak trees. Lions eat the weakest gazelle that can’t run away. Viruses pick off the weakest among any species. This is a cold fact about nature. Death is part of the cycle. Survival of the fittest! What is evolution but this?

“When someone dies of the common cold after fighting the AIDS virus for decades does that mean they died of the common cold?”

There is actually silliness in your question. Silliness because the question clearly indicates that a combination of factors contributed to death – which is the point being discussed and addressed here with the CDC data.

How can you ask such a question, look at the statistics, see 844K Covid deaths and not see that to attribute them solely and exclusively to Covid is clearly a flawed?

94% of Covid deaths require a combination of nearly 3 factors. Meaning, yeah Covid is dangerous…if you’ve compromised your body voluntarily through neglect or involuntarily through age or disease. This is data and information confirming what I and many others suspected. Now, what will we do with that data and that information? Will we ridicule it? Dismiss it? Or will we be responsible and use it to our benefit?

#21 YouKnowWho on 08.31.20 at 4:16 pm

#7 KNOW IT ALL on 08.31.20 at 3:32 pm
STAY in CASH….. and WAIT for the CRASH!!

Cuz here it comes…….

Properties will be selling for 50 cents on the dollar.

————————

50 cents on a dollar? I’m not sure that’s enough. At this point that’s back to 2017 levels – which was significantly overpriced and not in touch with any averages of balanced with average income multipliers.

25 cents on a dollar and we may be closer to the truth.

Oh, CAD or USD – it will matter because the 75% discount maybe via CAD devaluation. :-)

#22 theoryAndPractice on 08.31.20 at 4:18 pm

#8 Don Guillermo on 08.31.20 at 3:33 pm

Good writing. Looks like nothing changed so far !

#23 NanaimoStu on 08.31.20 at 4:22 pm

I still haven’t met a single person negatively financially impacted by COVID. My friend circle must be very well insulated. I do, however, know many that deferred mortgages just to save cash. I’d like to think they saved it, but I know for a fact it went on cars and/or vacations.

#24 Ace Goodheart on 08.31.20 at 4:24 pm

Re: New York Times: “The Demand is Insane” – in response to 97 showings and 24 offers.

That’s it?

That is like one weekend for a Bloor West special with an old, wonky iron piped hot water steam heating system supplemented by electric baseboards in rooms where the old iron steam radiators, covered over in layer after layer of paint, and full of over a hundred years’ of scale and residue, don’t work anymore.

“Have you ever seen so many people get so excited over a tree that is going to have to be cut down?”

This was the comment one of our neighbours made after probably over a hundred people showed up for back to back open houses, face masked, many carrying babies or pregnant, one sunny Saturday afternoon. Everyone was drooling over an old, half dead maple on the lawn.

I guess the Realtor did not point out that (a) it is a City tree and (b) it is coming down in the spring of 2021 as it is mostly dead and is in danger of falling over.

#25 Keep Dreaming on 08.31.20 at 4:24 pm

#7 KNOW IT ALL on 08.31.20 at 3:32 pm
STAY in CASH….. and WAIT for the CRASH!!

Cuz here it comes…….

Properties will be selling for 50 cents on the dollar
—————————————————————

SO back to where they were 2 years ago then?

#26 YouKnowWho on 08.31.20 at 4:27 pm

#183 YouKnowWho on 08.31.20 at 1:38 pm
#178 Masks really do make some people more attractive

I pay my municipality quarterly for my water supply. I pay for my groceries, every damn time. Are you suggesting that I shouldn’t?

———————–

“access to water”
“physical and economic access at all times to adequate food or means for its procurement”

Right to housing is clear and different.

—————–

Masks really do make some people more attractive

To be clear – the point you made about water, human right around it is based on “access”. The point about food, again human right around it is based on “access”.

But with housing it is “a human right to housing”. Not access. Not human right for a monthly fee. “human right to housing”.

Look, this needs case law, and it needs rulings, and it needs to work up to highest courts for interpretation and application. Clever lawyers will take this on and resolve it.

There is no doubt that it has the potential to be incredibly disruptive.

Here is the interesting thing to consider. OK, the law is to be interpreted, great. It is not constitutional and can be reversed.

So my question is – can it be reversed? Can any party honestly reverse in Canada “the human right to housing”.
How would that go over? Political suicide to do so?

#27 Guelph Guru on 08.31.20 at 4:34 pm

It’s only the SFH’s which are going up. REITs are in the dump, ZRE again below $20 today. SCHH is at 2014 levels. Cash flow for businesses has tanked.
If servicing more debt causes households to reduce spending then the cash flow would go down further. Not good for any business.
CERB and low interest rates were in place so that people continue surviving and spending, keeping businesses afloat, and we can all get out of this plague unscathed or with little bruising. A lot of ice cream shops and restaurants are running below avg levels.
Have been hearing that Canada Real estate is overpriced for 9 years, if COVID does not cause sensible values to return nothing will.
Ready for the tide to go out and watch the spectacle.

REITs are just fine, and on sale. Demand for space has started to tick higher as offices plan to reopen with distancing in place. Buy assets that are on sale, and this is one of them. Hold 4-5% in your portfolio. – Garth

#28 FreeBird on 08.31.20 at 4:34 pm

#12 Linda on 08.31.20 at 3:47 pm
I read that the bank regulator did put the kibosh on extending mortgage deferrals past 6 months for those who already have one, but anyone applying September 1 through October 31 might qualify for an additional 3 month extension. Can’t imagine the banks/mortgage companies will be rushing to approve any such applications though. I also read that OSFI was going to permit pension transfers to resume, but the article didn’t say exactly when that might occur. Note that the article mentioned pension portability between employers but didn’t say anything about pension commuting.
——————
Seems more like an exception or grace period based on effective date of deferral end of Oct 1st, 2020. More info at OSFI link below. I agree banks won’t be happy about extending terms.

“Loans granted payment deferrals after August 30 and on or before September 30 will be eligible for the special capital treatment outlined in March for up to three months.“

https://www.osfi-bsif.gc.ca/Eng/osfi-bsif/med/Pages/20200828_nr.aspx

#29 Prairieboy43 on 08.31.20 at 4:42 pm

Fear is our greatest enemy. Face it, get over it, beat it. “No Fear”. Went fishing out Terrace, Kitimat. Awesome catching big 10-14lb Coho Salmon. Pretty quiet except for LNG construction (digging out Port, building couple 8000 man camps). Met Italo Labignan, (Canadian fishing channel) and crew all 15 of them out of Toronto. Had good talk regarding River fishing. No masks seen/worn from Jasper to Prince George, Smithers, Terrace, Kitimat.

PB43

#30 SeeB on 08.31.20 at 4:48 pm

#13 akashic record on 08.31.20 at 3:50 pm

Watch when the 800,000 families start to demonstrate on the streets all over the country and organize into a political force.

————————————————————–

Good point. Not a politician in Canada today could survive an election by telling these people that maybe they’ve overspent and taken on too much debt.

#31 Miso Sea Bass with Prawn Louie Salad on 08.31.20 at 4:50 pm

“Millions are working remotely, so the dwelling becomes their world, 24/7 & 365/yr.”

Only for bores. The local beach bar has become my office. Martini Mondays, Tequila Tuesdays, Half Price Wine Wednesdays and so on. Turns out Covid is a nightmare for the liver.

#32 Smartalox on 08.31.20 at 4:50 pm

Update trading renting in Vancouver for owning in Edmonton.

Inventory on Zolo.ca is exploding (>10 new listings a day) from what I have seen, about 60% of homes offered are not currently (or not fully) occupied or that were purchased with the intent of renovating and re-selling, instead of long time sellers moving out.

We’ve bought a place now, and will be moving to Edmonton in October. Our reasons:

– Desire to be closer to aging parents; one of whom did visibly suffer from the effects of isolation from friends and family early in the pandemic.
– A viable grand-parental child care option (or two) for days when we have to work and junior is out of school.
– No need from either of our jobs to be in the office daily. My company has offices in multiple cities, my supervisor has not been in the office since March.
– Most of my work is intellectual, and involves review and approval of reports prepared by others, so my work really lends itself to telecommuting.
– Opportunity to attend our offices in short order, (<2h door to door) if in-person work is required.

One thing to consider about people like me working from cities outside the major centres:
– By buying homes in these cities, we're infusing new capital into the markets of the region.
– We're not competing with locals for jobs that may be scarce, and where the local industry has been hit hard by losses.
– We're also helping to diversify the local tax base (paying property tax, provincial income tax) working outside the local industries that have experienced well-publicized hard times.
– We're effectively importing two six-figure paychecks into the local economy. Spending includes purchases at local retailers (food, fuel) and supporting local businesses (restaurants, etc.).

#33 CALEDONDAVE on 08.31.20 at 4:55 pm

“It was lockdown time, so pent-up demand exploded like a sailor on shore leave.”

………………………….

That’s funny!

#34 YouKnowWho on 08.31.20 at 4:58 pm

#8 Don Guillermo

Have you seen PBS Command and Control?

I kid you not, I watched this show, and every few minutes I kept saying to myself out loud “NO WAY” in complete disbelief.

If you have not seen Command and Control – it is nothing short of MANDATORY! People watch some sci-fi comic book nonsense – when this actually happened! Arkansas could have been a crater!

SWEET MERCY the incompetence of the American Nuclear Weapons machine.

It is nothing short of a MIRACLE that the Americans didn’t accidentally bomb themselves and start off a nuclear holocaust.

Command and Control was 1980. How about this doozie from 1957?

May 22, 1957 – B-36 ferrying a Mark 17 nuclear weapon from Biggs AFB to Kirtland AFB accidentally dropped a nuclear weapon on approach to Kirtland. The incident spread radioactive contamination and debris over a mile-wide area.

Just FYI in case you’re not on the up and up – Mark 17 was the largest nuclear weapons ever put into service by the United States.

Yeah – the Americans bombed their own base by accident. The thing just happen to not go off!

Anyway, I’m fond of Duck, and I cover them in apples usually. Much more tasty and effective than “Duck and Cover.”

Here is a sobering reading list:
https://en.wikipedia.org/wiki/List_of_military_nuclear_accidents

#35 Billy Buoy on 08.31.20 at 5:01 pm

Let’s call a spade a spade…we are in a DEPRESSION if we really could measure the true unemployment rate.

Stock market not a Casino? Tesla up 75% this month alone. 5-6 stocks carrying the market and without Central bank pumping TRILLIONS into it we’d be pushing up daisies.

Watch out below.

#36 Isthistherealworld on 08.31.20 at 5:01 pm

Hi Garth,

Love your blog your dog is cute :)

I just wanted to say ditto to whoever posted about all the For sale signs in South Surrey. I live in Victoria in a less than desirable neighbourhood but with tons of old townhouses and condos. I’ve never seen so my for sale signs for condos down my block. Four to five units per building sometimes. Doesn’t look like they’re selling at all. Also worth considering is the nightmare that is brewing in BC with condo insurance…if I was the owner of one of these old condos I’d be shitting my pants right now… anyways… just my humble local perspective.

#37 Guelph Guru on 08.31.20 at 5:02 pm

“REITs are just fine, and on sale. Demand for space has started to tick higher as offices plan to reopen with distancing in place. Buy assets that are on sale, and this is one of them. Hold 4-5% in your portfolio. – Garth”
—–

Thanks Garth. Appreciate it. Will rebalance tomorrow.

#38 FreeBird on 08.31.20 at 5:11 pm

“A number of lenders have said a significant share of mortgage deferral applications have come from people who, while able to pay, wanted to free up cash to build an emergency fund.“ (while able to pay?)

A financial planner/author advised maybe hanging onto emergency fund for a while and using to make lump sum pyt later. Interesting to hear Garth’s or other’s take on this.

https://www.google.ca/amp/s/globalnews.ca/news/7301071/mortgage-deferrals-end-cant-pay/amp/

#39 Dolce Vita on 08.31.20 at 5:13 pm

N. American CULTURAL:

IMMEDIATE GRATIFICATION. Powder, water, mix, 5 min later you have your dessert.

Used to be people would save then buy something.

Financial institutions said why wait, here’s the cash. Gov Canada insures the banks so it’s a win win for them. So everybody goes out and buys a home even those that shouldn’t but do anyway. Higher than normal demand. Gov Canada brings in a few 100 thousand newcomers of home buying age just in case, to top off demand or increase it even more (and GDP).

In Italia they still SAVE to buy a home. No excessive immigration. You have a recession in Italia like Canada and high employment in Italia like Canada.

DIFFERENCE is, home prices in Italia DROPPING as they should.

Welcome to N. America. Immediate gratification that is cultural.

Those are your root causes. (covid an excuse, not a cause).

———————————–

ENJOY. It’s what you wanted Canada. BE NOT AMAZED.

#40 Linda on 08.31.20 at 5:25 pm

#26 ‘You’ – missed the earlier discussion, but was interested to read about ‘a human right to housing’. Is this a legal thing in Canada? So if someone squats or chooses to occupy a structure they neither own or rent the actual owner might not be able to evict because the squatter has ‘a human right to housing’? Seems to be a very open ended proposition. Could someone walk into someone else’s dwelling & refuse to leave because they have ‘a human right to housing’?

In the rush to make things ‘fair’ and ‘equitable’ for all, seems like the price of doing so is the expectation that those who have will pay for those who don’t, regardless of the circumstances. Don’t see this ending well.

#41 Dogman01 on 08.31.20 at 5:26 pm

#93 Nonplused on 08.30.20 at 7:29 pm
#127 YouKnowWho on 08.30.20 at 10:11 pm

I got a bit riled up as James post as few days ago seemed quite likely:

#136 James on 08.27.20 at 11:40 pm
– The whole point of what they are doing is to inflate away the debt.
– inflation will come extremely hard and purchasing power down.
– average working person won’t be getting pay raises even close to matching what the inflation will be.
– Yet again, standard of living will go down.
– House prices and the stock market will stay high as the best places for purchasing power preservation.

————————————————–

https://www.goodreads.com/book/show/52512861-the-expendables
I will pick this up.

I think a stat, something like Per Capita GDP for the bottom 80 percentile adjusted to inflation, might illustrate the decline of the Canadian working class.
I became “woke” to this via this 1994 Interview with Sir James Goldsmith in 1994 ; http://www.youtube.com/watch?v=4PQrz8F0dBI
Sending production overseas and importing the product back, simply imports unemployment, it reduces opportunity for many and enriches just few. It is a model of a parasite feeding off the host society.
Just like Trickle Down Economics, Globalization\Free Trade concentrates wealth in fewer and fewer hands and is a “race to the bottom”. Our Leaders have known this and it is obvious they are providing lip service and a hand wringing placebo, they will not “stand up for middle class Canadians and those working hard to join them” https://liberal.ca/speech-by-justin-trudeau-on-fairness-for-the-middle-class/

“It’s a club and your not in it”
Traditional Blue tie or Red Tie Politicians in the Western World have been providing cover and support for what looks like a 40 year “Takedown” of workers share of the “value added”. (our Standard of Living). Odd that this trend seemed to have started just after the USSR (and the threat of Communism) collapsed.

The recent “racial” unrest, election of Trump, radicalization of politics are all symptoms of the declining opportunity , increased poverty , concentration of wealth and class warfare.

After watching Planet of the Humans, I suspect our “Green New Deal” is the next scheme, providing Greenwashing to continue shifting more wealth to the top.

#42 UtterlyConfusedCanadian on 08.31.20 at 5:27 pm

#176 Cabbagetown Carly on 08.31.20 at 12:26 pm
146 – UtterlyConfusedCanadian

I find it a bit “rich” that those with taxpayer DB pensions are the ones talking about raising the inclusion rate as if it doesn’t affect the middle only the ultra wealthy. What they fail to understand is that there are circumstances where the bulk of the retirement is in non-registered accounts for some folks. Anyone lost a non-taxpayer back DB plan? Sears? Nortel? How is this fair?
_______________________
Cabbagetown Carly on 08.31.20 at 12:26 pm

You and crowdedfartz make the same kind of uninformed comment about public sector DB pensions. You are both either lazy or dumb or both. Do some actual research, or please just go away.

—-

CC are you having a bad day? Don’t you think your response is a little over the top? Maybe its time for a drink….In any case, the federal DB pension is a 50:50 deal. 1/2 from the employee and half from the GoC (the employer).

So where does the government get its money? Is there a magic money tree that isn’t the tax payer? Please enlighten us all. It’s general knowledge that its taxpayer’s money feeds the government, pays the public employees and hence, its the taxpayers money which pays for both parts of the pension submission.

In any case, you missed the point. There are many private individuals who self fund their retirements in non-registered accounts because of circumstances beyond their control and inappropriate government rules. Its extremely unfair to target people who look after themselves with a higher inclusion rate without targeting the larger population and pension problem.

#43 MF on 08.31.20 at 5:28 pm

crowdedelevatorfartz on 08.31.20 at 3:28 pm

There is always some residual spillover of US issues into Canada.

But if you think you can compare some peaceful protests, and some vandalism of statues up here to the wanton violence, looting and total division going on down south you are clueless. Actually, pretty much as clueless as you are about pensions.

MF

#44 Coho on 08.31.20 at 5:30 pm

We keep hoping that things will go back to “normal”. Actually, they are. The creation of the middle class was necessary to build the architecture of our own oppression. It’s arguable if we still truly have a middle class. If not, then it was a brief blip in the history of mankind, which has typically been of a master-slave dynamic. This has been the “normal” and what some have termed as the “Great Reset” is all about.

Markets and real estate have been propped up to keep the game going. “Experts” are really stretching with theories and explanations in trying to explain the unexplainable.

It’s ironic that people are “moving up the property ladder” living in every larger houses, yet there isn’t enough room or time to care for the older generations. In other words, mom and dad have to save a couple million bucks in order to live in reasonable comfort before they croak. Must be a Western Society thing.
bucks for their retirement

Programming is a real thing. There are many levels, within families, communities, cultures, industries, politics, religion, education. It is everywhere. Couple that with the drumbeat of non-stop media stories pushing one thing or the other and it is like the blind leading the blind. None one or no-thing is free of seen and unseen forces influencing their decision making. No one and no-thing is free of the hidden puppet strings tugging at them.

Covid has proven that fear is the biggest motivator, especially the fear of dying before one’s time. We all know we’ll perish one day, but for most it is something out in the distant fog. You know it’s there but can’t see it, therefore it resides in the back of our minds. Covid has been cruelly used to push the fear of death onto the front burner, which is as a very cruel attack on the human psyche and quality of life. Most are ignorant and innocent players perpetuating the Covid drama, but there are those in the know whose intentions are not innocent in all of this.

Regardless of whether it was a natural occurrence, accidently released from a lab, or deliberately unleashed on the people, it has been used in a cruel and inhumane way to alter what was a far from perfect society into one that may be much worse.

#45 David Pylyp on 08.31.20 at 5:37 pm

Millennial’s are frothing to buy.

“The obvious first reason houses are going up is that interest rates have come down. Cheap mortgages allow folks to borrow more, spend more, and squeeze prices higher. Second, we had no spring market. It was lockdown time, so pent-up demand exploded like a sailor on shore leave. Third, demographics have been pushing real estate. The largest cohort in society are the Millennials, all 9.8 million of them. That’s 27% of the population, and they’re all horny. For houses.”

Seniors are shuttering their door against the NOTE and Baked Cookie presents; Refusing to LIST. They make more waiting another 12 – 24 months compared to a GIC @ 1.5%

David Pylyp
House Values Toronto

#46 Cici on 08.31.20 at 5:50 pm

I forecast that a large majority of the deferral club peeps will be cashing out of all the Tesla and Bitcoin positions they’ve been stockpiling since the mortgage holiday began and will be diverting those gains towards the payment of their mortgages.

#47 Ponzius Pilatus on 08.31.20 at 5:52 pm

After watching the riots in Portland, I finally find the real use of flag draped F-150s.

#48 Yukon Elvis on 08.31.20 at 5:53 pm

#185 YouKnowWho on 08.31.20 at 1:45 pm
#177 Yukon Elvis

———–

Serious questions about this. We can’t answer them, but we can certainly agree that a human right goes right to the front of the line.
Surely no contract or lease can be put in front of a human right.
Surely no right to property can be put in front of a human right.
Surely no right of landlord can be put in front of a human right.
BlogDogs – be sure to highlight on here any Human Right housing cases you see rulings on.
I actually think that this will likely be argued in current disputes with landlords over what just happened past 6 months. All these evictions – are now in a housing as a human right environment. It’s a whole new ball game – surely.
…………………………..

Bingo bango bongo ! I can hardly wait to exercise my human right to shelter. Gonna sell my condo, move into someone else’s, never pay rent, and spend all my cash on wine, women, and song. Let the good times roll ! Thanks Garth, I never knew I had a human right to shelter until you posted it here yesterday.

#49 YouKnowWho on 08.31.20 at 5:53 pm

#13 akashic record on 08.31.20 at 3:50 pm

Watch when the 800,000 families start to demonstrate on the streets all over the country and organize into a political force.

————-

As noted by Garth on here “Housing is a Human Right” in Canada.

Now yesterday I started a discussion about this point as it relates to rental properties. As in, tenant has no money to pay for rent, how can he be denied his Human Right to housing? Is Human Right a monthly subscription thing you have to pay for? Or do you have it? Once this right is granted by the landlord, it cannot be violated or withdrawn as it surely takes priority over leases or rent dues.

But actually, applying the Human Right to Housing in Canada to homes on which there are unplayable mortgages is another interesting one. And one with much more at stake.

Can a bank reposes, evict and sell a residential house on which they have an unpaid mortgage and violate the Human Rights to Housing of multiple individuals living in that house?

Can a bank force someone to sell a house that results in direct violation of their Human Rights to Housing?

Garth often mentions on here that you don’t have a given right to own real estate – and that is true. But you do have a Human Right to Housing in Canada.

And what if that Human Right is currently provided to you by a home you occupy on which you are not able to pay the mortgage?

Of course CMHC already owns all the liability on these mortgages, so taking ownership of the house while making banks whole and letting those who didn’t pay the mortgage live in the house as to not violate their Human Rights seems like a path to resolution. Oh sure, some private insurers will take a beating too. Boo hoo hoo…who feels bad about insurance companies?

Again, needs to go through courts. But if you’re not paying your mortgage, taking on this legal challenge through the court system would totally make perfect sense to test this Human Right to Housing. Obviously no one can touch you until the case is settled as well.

One way or the other, rental or owned residences, I’m betting Covid-19 will give us an answer to this new Human Right to Housing in Canada.

#50 BillyBob on 08.31.20 at 5:54 pm

#35 Billy Buoy on 08.31.20 at 5:01 pm

Stock market not a Casino? Tesla up 75% this month alone. 5-6 stocks carrying the market and without Central bank pumping TRILLIONS into it we’d be pushing up daisies.

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

Yep, and if my uncle had t!ts he’d be my auntie.

Your comments remind me of Ryan’s a couple days ago. To paraphrase, along the lines of “you can wax philosophical about the role of CB’s, or you can get on board and make money”.

I take it that much like MF and real estate, you didn’t buy a ticket…?

#51 Yukon Elvis on 08.31.20 at 6:03 pm

Since the Emerson College July national poll, President Donald Trump has tightened the presidential race to a two-point margin, and is now trailing former Vice President Joe Biden 49% to 47%.
Spencer Kimball, Director of Emerson College Polling explains “the Republican convention gave Trump his most positive week of news coverage which likely attributes to his bounce in this month’s poll and increasing job approval.

https://emersonpolling.reportablenews.com/pr/july-national-poll-biden-maintains-lead-in-presidential-race-majority-support-nationwide-mask-mandate-in-public-spaces

#52 TalkingPie on 08.31.20 at 6:06 pm

A relative just bought a nice split level bungalow on maybe 7,000 sq ft in Oakville for 1.3 million. The plan: tear it down and build something bigger on it. Their current house, 10 minutes away (also in Oakville), was not big enough, and not in a swanky enough neighbourhood for their liking – too many working class people living in that 7 figure neighbourhood, they say.

#53 crowdedelevatorfartz on 08.31.20 at 6:07 pm

@CrabbytownCarly and EmmEff

Govt employee pensions are subsidized ( and guaranteed ) by taxpayers.
That is an undeniable fact.

“Peaceful” protesters dont spay paint storefronts, sidewalks, cars with silly acronyms, rip statues from their plinths and demand the naively childish request that the police should be replaced….. thats what criminals and anarchists do.

Time for the law abiding, peaceful population to refund the police, swear in several thousand citizens as special constables , hand out helmets, batons and let the games begin.

Tear Gas is not enough

#54 ImGonnaBeSick on 08.31.20 at 6:18 pm

#47 Ponzius Pilatus on 08.31.20 at 5:52 pm
After watching the riots in Portland, I finally find the real use of flag draped F-150s

—-

Spoken like someone that’s never done a day’s work in his life…

#55 earthboundmisfit on 08.31.20 at 6:19 pm

@29 Prairieboy43
Ya just had to go and mention Prince George. Spent the three longest years of my life in that shithole, and years trying to forget it. Never, ever been so glad to see it in my rear view mirror, heading east on the Yellowhead.

#56 Something's Wrong on 08.31.20 at 6:25 pm

It is my understanding that if I see a car advertised, the dealer cannot charge above the price advertised but in the golden horse shoe a single family homes’ ” asking price” bears absolutely no relation to the price it will sell for ( eg maybe hundreds of thousands more). How can one even begin to assess this market if they were dumb enough to buy now.

#57 dogwhistle on 08.31.20 at 6:26 pm

#39 Dolce Vita on 08.31.20 at 5:13 pm
N. American CULTURAL:

IMMEDIATE GRATIFICATION. Powder, water, mix, 5 min later you have your dessert.

ENJOY. It’s what you wanted Canada. BE NOT AMAZED.

———————————————————

Canadians think RE only goes up, if you’ve travelled in the US a few years ago or across Spain where you see thousands of abandoned houses maybe you’d think different.

But hey, so much better than Europe. LOL

#58 Dirty Dan on 08.31.20 at 6:30 pm

#43 MF on 08.31.20 at 5:28 pm
crowdedelevatorfartz on 08.31.20 at 3:28 pm

There is always some residual spillover of US issues into Canada.

But if you think you can compare some peaceful protests, and some vandalism of statues up here to the wanton violence, looting and total division going on down south you are clueless. Actually, pretty much as clueless as you are about pensions.

I have been diligently watching CNN. Aside from a few isolated incidents of right-wing racist homophobic trump racists there has been nothing but peaceful protesting in the US. If I’m in some sort of “media bubble”, than clearly it is quite large and far reaching.

#59 akashic record on 08.31.20 at 6:32 pm

#49 YouKnowWho

It is an interesting legal situation, indeed.

Declaring housing as human right is the government version of buying overpriced real estate with money you don’t have.

#60 YouKnowWho on 08.31.20 at 6:33 pm

#44 Coho

Heck of an opinion comment.

#48 Yukon Elvis

Human right to HOUSING! …not shelter. Important.

There will be a whole lotta shaking heads going on. This law appears to be wide open to interpretation and application and it will take the highest court to make a call on this.

But in the end, I don’t see how you square a Human Right to housing with, only if you pay for it.

Anyway, it’s all just leaseholds to land apparently The Queen owns. Because it makes sense that the royal family would present a contract to natives in a language that they don’t speak to force them to agree to laws of foreign land upon which the royals uphold an ownership claim to Canada. Hilarious.

Paying $2m for a slanted semi for a leasehold on land you down own, and to further prove you don’t own it you have to pay taxes to the owner that can be increased at will because the land you don’t own is worth more…is perhaps the biggest house of cards scam ever.

I think I’m going to Thailand. Castles for $200k. But why buy when you can just rent one?

#61 Leftover on 08.31.20 at 6:40 pm

Covid and real estate are a lot like 9/11 and real estate – Greenspan dropped rates, housing took off, and we all know how that turned out.

Back then it was more YOLO than FOMO because people in the USA were scared in an existential rather than financial sense, but the effect was the same. The grown-ups at OSFI and CMHC know this and that’s why they’re saying and doing the things that they are.

Credit access is going to get choked off in the next year or so, followed by interest rates as bond markets react to any nation that can’t control the urge to print money.

That would be Canada.

#62 Teachers Lives Matter on 08.31.20 at 6:45 pm

All people have the right to refuse unsafe work.

If I was a teacher I would not be showing up and declining work based on unsafe working environments.

Watch this sshow in the coming month. Without schools (aka government subsidized child care) the economy will be taking more hits.

The return to school plan is botched and gov. can’t stop teachers from shutting down the system.

Lastly, if the teachers don’t shut down the school system, the virus will.

Numbers are spiking – look at BC. Huge virus numbers hitting.

The US sucked at re-opening and so to does Canada. Simple things overlooked. Vaccine only hope for calm. Stormy weather until then. This will be the nastiest fall in Canadian history.

#63 Uncle Al Sinclair on 08.31.20 at 6:46 pm

21 YouKnowWho on 08.31.20 at 4:16 pm
#7 KNOW IT ALL on 08.31.20 at 3:32 pm
STAY in CASH….. and WAIT for the CRASH!!

Cuz here it comes…….

Properties will be selling for 50 cents on the dollar.

————————

50 cents on a dollar? I’m not sure that’s enough. At this point that’s back to 2017 levels – which was significantly overpriced and not in touch with any averages of balanced with average income multipliers.

25 cents on a dollar and we may be closer to the truth.

Oh, CAD or USD – it will matter because the 75% discount maybe via CAD devaluation. :-)
—————————————————————

Dream on both of you…reminds me of a chance meeting in a McDonalds a decade ago. I heard two young gents discussing the impending 30-40% drop in Toronto house prices. I excused myself for eavesdropping and then told them there was no hope in hell of that happening. Hope they took my advice because they would have made a killing in the past decade.

#64 cristian on 08.31.20 at 6:46 pm

#39 Dolce Vita on 08.31.20 at 5:13 pm
N. American CULTURAL:

IMMEDIATE GRATIFICATION. Powder, water, mix, 5 min later you have your dessert.

Used to be people would save then buy something.

Financial institutions said why wait, here’s the cash. Gov Canada insures the banks so it’s a win win for them. So everybody goes out and buys a home even those that shouldn’t but do anyway. Higher than normal demand. Gov Canada brings in a few 100 thousand newcomers of home buying age just in case, to top off demand or increase it even more (and GDP).

In Italia they still SAVE to buy a home. No excessive immigration. You have a recession in Italia like Canada and high employment in Italia like Canada.

DIFFERENCE is, home prices in Italia DROPPING as they should.

Welcome to N. America. Immediate gratification that is cultural.

Those are your root causes. (covid an excuse, not a cause).
***************************
Common .. Italians male way less money than Canada .. .Corruption in Italy is MASSIVE .. Canada is playing in little leagues … No immigration ? What about all the “rescue” ships bringing hundreds daily ….
Common … we love Italy .. I go every year (this year cancelled (we were supposed to go in Marche coming from Cote D’Azur .. last year was Puglia .. Marche … Rome) .. but they make way less money compared to Canada and they cannot get credit because all the banks are f..ed .. lets be honest

#65 Steven Rowlandson on 08.31.20 at 6:50 pm

Perhaps this is the only thing that people are sure of that makes money. Borrowing the official currency makes money for want of a better way of saying it. Work, production, investing and inventing things pales into insignificance next to jacking up home or property prices and telling the buyers they have to live some where or they are nobody……It is the uber bubble and it has to pop for real.

#66 Uncle Al Sinclair on 08.31.20 at 6:54 pm

#56 Something’s Wrong on 08.31.20 at 6:25 pm
It is my understanding that if I see a car advertised, the dealer cannot charge above the price advertised but in the golden horse shoe a single family homes’ ” asking price” bears absolutely no relation to the price it will sell for ( eg maybe hundreds of thousands more). How can one even begin to assess this market if they were dumb enough to buy now.
————————————————————–

It is not the wild crapshoot that you think. Even when there are no comparables, the way to figure out the price of a home in Toronto for example is to find out what lots are going for in the area ( a lot being a property with a tear down house) and then the building cost of the home that is on the property. I did this recently on an estate sale and was spot on for what the home sold for.

#67 the Jaguar on 08.31.20 at 6:55 pm

@#8 Don Guillermo on 08.31.20 at 3:33 pm

Such wise words from CS Lewis………………….++++++++++

What a perfect piece and post for reflection by all. When it was published in 1948 the memories of the Great Depression, WW2 and WW1 were likely fully intact by most who were still alive to reflect on the misery they caused.
That’s not really the case today for the group that Garth identifies as the primary movers of the current housing frenzy…. (“Third, demographics have been pushing real estate. The largest cohort in society are the Millennials, all 9.8 million of them. That’s 27% of the population, and they’re all horny. For houses.”).

There have been numerous references to Millennials and their characteristics on this blog in past years. My observations echo many of those sentiments. They have a noticeable sense of entitlement. This doesn’t marry well with FOMO. Helicopter parenting solved many of their problems on their behalf, hence they do not problem solve very well or see the banquet of consequences they will sit down to if they make poor choices in life. I don’t say this as an indictment of all, but as an observation of some. Has Faron apologized to Garth, by the way? Maybe it was a private affair.

Many who read this wise blog understand that our current lifestyle and economic prosperity result from the sacrifices made by our parents and grandparents and that true happiness & character really come from that old meme ‘The important thing in Life is not triumph, but the struggle; the essential thing is not to have conquered but to have fought well.’

Or maybe what the Fox in the Little Prince said about ‘” It is only with the heart that one can see rightly; what is essential is invisible to the eye.”
We live in interesting times and they are about to get more interesting. Where are my binoculars? I think I see a flock of chickens making a bee line for their coop………Mercy.

#68 Nonplused on 08.31.20 at 6:56 pm

#8 Don Guillermo on 08.31.20 at 3:33 pm

When CS Lewis wrote that, the hydrogen bomb had not yet been invented and people thought about Hiroshima and surviving for a few months in a bomb shelter, then returning to life as normal minus a few cities. What we have today is about as different as it could be. A full on exchange between Russia and the US would likely end life on the planet. Even a sneak attack by one side on the other could end the planet. And now many more countries have the bomb. Terrorists may get it. The situation is pretty alarming but I don’t see how everyone backs down and dismantles them.

I suppose it doesn’t matter if the planet dies once you are dead. You won’t need it anymore. That is Putin’s stated nuclear strategy. “No world without Russia.” As the French say (roughly), “first me, then the deluge”.

As far as any analogy you may be making to covid, I don’t think it works. I understand the argument people make that “it is no big deal and I want to live my life and I probably won’t die anyway” but it seems pretty selfish to me. Back in the days when AIDS first hit they made it a criminal offense to spread it knowingly. I think it still is. So to me a cavalier “mostly old people die” or “we’re all going to die one day” attitude is at best socially reprehensible and at worst criminal. I mean, if “we are all going to die one day anyway” is a good excuse for allowing covid to spread why are we so worried about all the Fentanyl overdoses? Those people die in no pain and it probably won’t happen to me. Or why do we worry about gun crime? “Oh well he was going to die one day anyway” we may as well say. Or why don’t we get out some lawn chairs and fire off all the bombs and treat it like a big fireworks display?

It seems to me most people, given the chance, would rather not wake up dead tomorrow even if they are going to die one day anyway.

Covid restrictions are in a way similar to fire bans. Yes they apply to you. If you decide to have a fire anyway and a bunch of houses or a forest gets burned down, no you were not acting within your “rights”. Your rights end where mine begin and vice-versa. Much of the building codes are designed around preventing another “Boston fire of 1872”. Yes you have to follow them or the city won’t let you build. Even if you are going to die one day anyway. The idea is that it is not within “your rights” to take everyone with you.

Maybe I’ll sign up for some sky-diving lessons. I’ll skip the part on how to open the parachute, as it seems like a waste of time.

#69 Ronaldo on 08.31.20 at 7:08 pm

#49 YouKnowWho

This may be of interest to you.

https://cwp-csp.ca/poverty/human-rights-violation/the-right-to-housing/

#70 Flop... on 08.31.20 at 7:10 pm

#147 Dharma Bum on 08.31.20 at 8:17 am
#38 Flop

Colorado is a great state to explore.

It’s my perennial go to place.

I once even road my old motorcycle out there from Ontario. Rode it to the peak of Mount Evans (14,000′ +). The altitude fried the horn, somehow.

So many excellent spots in CO.

Make sure you also get to Telluride in the San Juan mountains of south western Colorado. Epic.

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

Mr Bum!

It’s Mr Flop here!

If they ever decide to do an updated version of Reservoir Dogs, then me and you will certainly get a call up.

Sorry for the delay in replying, I was slaving away at work trying to fund this trip.

Haven’t fully retired yet, only some sort of health induced quasi semi-retirement.

Whatever that is, I’m doing it.

You mentioned Telluride, that’s where I want to start, sort of.

Get to Salt Lake City, head off on a 45 degree angle towards Moab and check out Arches National Park, before continuing on to Durango, and then start working our way up towards Denver.

Colorado.com has done a good job of videoing and condensing all the scenic routes into one minute segments, but it is The San Juan Skyway that stirs my travel loins.

https://www.colorado.com/byways/san-juan-skyway

Could be next summer, could be the one after, who knows with the current state of affairs.

Mrs Flop asked me the other day how much all this was gonna cost.

I replied, I can’t afford not to have something to look forward to right about now…

M46BC

#71 A Decade On and No Change on 08.31.20 at 7:13 pm

The reality is that house prices have risen since the early 2000s, unfazed by any global developments or Canadian policy changes. The biggest dip was for half a year during the Great Financial Crisis of 2008, and then prices resumed.

The end of the mortgage deferrals means nothing as CERB has just been transitioned into CERB lite, with a couple hundred dollars less per month. They largess continues and it will continue indefinitely regardless of the impact on the deficit or debt.

Every year there is some new policy change or demographic time bomb which is supposed to tank the market. And every year the prices miraculously rise.

The reality is that those who were financially prudent and rented and invested the difference between owning and renting have faired poorly to those that had no assets, jumped into the real estate market. Their equity far, far overshadows any modest 5% gains in un-leveraged portfolios. Their net worth far outweighs an renter with a balanced portfolio.

The masses have been rewarded with an ever inflating asset, while the cautious, financially prudent, and contrarians have been slaughtered.

There will not been any slow melt in prices. Interest rates will remain low for years. People have recency bias. All sense of personal and corporate responsibility has wiped away with Covid, as the feds have shown a willingness to bailout homeowners and subsidize businesses for unspecified periods of time. A job and a home are to be guaranteed by the government – Canada has had the most generous Covid assistance.

This time next year, everyone will still wonder why prices are going up.

#72 Ponzius Pilatus on 08.31.20 at 7:14 pm

#53 crowdedelevatorfartz on 08.31.20 at 6:07 pm
@CrabbytownCarly and EmmEff

Govt employee pensions are subsidized ( and guaranteed ) by taxpayers.
That is an undeniable fact.

“Peaceful” protesters dont spay paint storefronts, sidewalks, cars with silly acronyms, rip statues from their plinths and demand the naively childish request that the police should be replaced….. thats what criminals and anarchists do.

Time for the law abiding, peaceful population to refund the police, swear in several thousand citizens as special constables , hand out helmets, batons and let the games begin.

Tear Gas is not enough
————–
Sorry, CEF I accused you of not being educated enough to make statements about how the Nazis came to power.
I was wrong, you must have read “Mein Kampf”.
And you forgot to quote Trump “when the looting starts, the shooting starts”.

#73 Ponzius Pilatus on 08.31.20 at 7:21 pm

#54 ImGonnaBeSick on 08.31.20 at 6:18 pm
#47 Ponzius Pilatus on 08.31.20 at 5:52 pm
After watching the riots in Portland, I finally find the real use of flag draped F-150s

—-
Spoken like someone that’s never done a day’s work in his life…
———-
30 years in Accounting. 45 sick days.
What’s your claim to fame?

#74 Cottagers STAY THE HELL AWAY! on 08.31.20 at 7:25 pm

Did you enjoy your weekend up here, all you southern inbred hillbillies?

Now we have to pick up all the crap you’ve left behind, piles of garbage everywhere.

https://www.cbc.ca/news/canada/london/huron-county-runner-litter-1.5701002?__vfz=medium%3Dsharebar

Enjoy our countermeasures, coming soon.

#75 Nonplused on 08.31.20 at 7:27 pm

Cheese and crackers, folks, a “right” to housing is not the same thing as the government handing them out, any more so than the US “right to bear arms” means the US government is handing out guns to everyone on their 18th birthday along with their voter card.

You have a right to housing, but you still have to pay for it.

#76 Greg on 08.31.20 at 7:28 pm

SFHs are the new toilet paper.

#77 Not a Member of the C.S.Lewis Society on 08.31.20 at 7:33 pm

#68 Nonplused on 08.31.20 at 6:56 pm
#8 Don Guillermo on 08.31.20 at 3:33 pm

When CS Lewis wrote that, the hydrogen bomb had not yet been invented and people thought about Hiroshima and surviving for a few months in a bomb shelter, then returning to life as normal minus a few cities…
—————————————————————
Good answer to the logic of C.S.Lewis. His thoughts on the atomic age were as flawed as many of his other arguments.

#78 Nonno Nicola on 08.31.20 at 7:37 pm

#64 cristian on 08.31.20 at 6:46 pm
#39 Dolce Vita on 08.31.20 at 5:13 pm
N. American CULTURAL:

IMMEDIATE GRATIFICATION. Powder, water, mix, 5 min later you have your dessert.

Used to be people would save then buy something.

Financial institutions said why wait, here’s the cash. Gov Canada insures the banks so it’s a win win for them. So everybody goes out and buys a home even those that shouldn’t but do anyway. Higher than normal demand. Gov Canada brings in a few 100 thousand newcomers of home buying age just in case, to top off demand or increase it even more (and GDP).

In Italia they still SAVE to buy a home. No excessive immigration. You have a recession in Italia like Canada and high employment in Italia like Canada.

DIFFERENCE is, home prices in Italia DROPPING as they should.

Welcome to N. America. Immediate gratification that is cultural.

Those are your root causes. (covid an excuse, not a cause).
***************************
Common .. Italians male way less money than Canada .. .Corruption in Italy is MASSIVE .. Canada is playing in little leagues … No immigration ? What about all the “rescue” ships bringing hundreds daily ….
Common … we love Italy .. I go every year (this year cancelled (we were supposed to go in Marche coming from Cote D’Azur .. last year was Puglia .. Marche … Rome) .. but they make way less money compared to Canada and they cannot get credit because all the banks are f..ed .. lets be honest
—————————————————————-

I concur! Dolce Vita is looking at Italy through rose coloured glasses. My relatives in Italy live with four generations in one home. They make a pittance for wages even they even have a job. Low wages, no wages=low real estate prices. Italy is a great, great place to visit like Greece but I wouldn’t want to live there if I had to eke out an existence on low wages.

#79 Nonplused on 08.31.20 at 7:39 pm

#58 Dirty Dan on 08.31.20 at 6:30 pm

“I have been diligently watching CNN. Aside from a few isolated incidents of right-wing racist homophobic trump racists there has been nothing but peaceful protesting in the US. If I’m in some sort of “media bubble”, than clearly it is quite large and far reaching.”

You are supposed to end such comments with “sarc/off”.

#80 Brian Ripley on 08.31.20 at 7:53 pm

While we wait for August 2020 real estate data, here is my month-end Covid 19 update: http://www.chpc.biz/history-readings/pandemic-update6280071

3 charts showing monthly percentages of deaths per cases (3%) and M/M changes in cases, deaths and recovereds as well as a logarithmic chart showing the rate of acceleration.

#81 Stone on 08.31.20 at 8:02 pm

#62 Teachers Lives Matter on 08.31.20 at 6:45 pm
All people have the right to refuse unsafe work.

If I was a teacher I would not be showing up and declining work based on unsafe working environments.

Watch this sshow in the coming month. Without schools (aka government subsidized child care) the economy will be taking more hits.

The return to school plan is botched and gov. can’t stop teachers from shutting down the system.

Lastly, if the teachers don’t shut down the school system, the virus will.

Numbers are spiking – look at BC. Huge virus numbers hitting.

The US sucked at re-opening and so to does Canada. Simple things overlooked. Vaccine only hope for calm. Stormy weather until then. This will be the nastiest fall in Canadian history.

———

Unfortunately, I completely agree with you.

#82 Ace Goodheart on 08.31.20 at 8:03 pm

Re# 74 Cottagers stay away person:

Hello Karen, how have you been?

Are you sure that garbage on your roadside comes from cottage owners?

Seems odd. People who own land, throwing garbage around. Sounds more like day trippers to me.

Our cottage is a five minute drive from the famous Torrance Barrens dark sky preserve.

This summer reckless camping and general carelessness led to a lot of garbage being thrown around the preserve

It was disgusting. Guess who helped clean it up?

Cottage owners, of course (including yours truly).

We protect and preserve our cherished natural areas and we are constantly picking up litter left by day trippers and wild campers.

We also go out by boat to the four islands often used by campers, and we clean them up too.

We also act to preserve the turtle population and we work with the Ministry to protect the rare blue bellied skink (one of Ontario’s only native lizard species) that has a number of population bases in our area.

We do not throw litter out the windows of our cars.

In fact, we stop to pick it up.

You really have to stop trashing land owning cottagers on here.

#83 Manitoba Whale on 08.31.20 at 8:06 pm

8 Don Guillermo on 08.31.20 at 3:33 pm
Wise words from CS Lewis:
Here’s what he said in 1948 about the mental shift required by living with the threat of the atomic bomb

*****
Thanks Don.
Always appreciate C.S. Lewis as a voice of reason. A very thoughtfully guy.

#84 Nonplused on 08.31.20 at 8:08 pm

#77 Not a Member of the C.S.Lewis Society on 08.31.20 at 7:33 pm
#68 Nonplused on 08.31.20 at 6:56 pm
#8 Don Guillermo on 08.31.20 at 3:33 pm

When CS Lewis wrote that, the hydrogen bomb had not yet been invented and people thought about Hiroshima and surviving for a few months in a bomb shelter, then returning to life as normal minus a few cities…
—————————————————————
Good answer to the logic of C.S.Lewis. His thoughts on the atomic age were as flawed as many of his other arguments.

——————————————–

I’m not going to put my intellect up against that of C.S.Lewis, I can’t hold a candle to him. But I think we have to look at what he wrote in context. He wrote that in…. 1948. He was talking about something you could not have any personal influence over. It was probably a good message for… 1948. Last I checked it is now 2020 and covid is something we can influence even without a vaccine.

When AIDS came about, the medical advice was “wear a condom”, but many refused. Some still do. But condoms probably saves many lives once they finally caught on and you could get them at the 7-11. Masks are no different. We know already that staying home when sick and washing your hands is effective against the flu and common cold. It will be against covid too. We have some tools! They are known to work! They aren’t perfect but they are better than nothing. I mean we don’t just let Ebola run wild. Or AIDS. Or swine flu, because we need our yummy hotdogs. Does anybody remember how we locked down the farms when Mad Cow disease came to town? We fixed that too, you don’t hear about it anymore.

It absolutely astounds me when somebody says that masks don’t work because they aren’t 100% effective. I mean I have to give them that point, because they are not 100% effective. But neither are condoms. But I would rather have a 5% chance of a paternity suit than a +50% chance any day. And there is still the AIDS thing.

#85 Ace Goodheart on 08.31.20 at 8:10 pm

Sorry, it’s a blue tailed skink, also known as the five lined skink and it is actually Ontario’s only native lizard species.

#86 Dirty Dan on 08.31.20 at 8:10 pm

#79 Nonplused on 08.31.20 at 7:39 pm
#58 Dirty Dan on 08.31.20 at 6:30 pm

“I have been diligently watching CNN. Aside from a few isolated incidents of right-wing…

You are supposed to end such comments with “sarc/off”.

I would, but I’m worried about getting censored again. It seems only comedy and sarcasm allow people actually able to tell the truth anymore:

https://www.youtube.com/watch?v=Ev373c7wSRg

#87 George on 08.31.20 at 8:28 pm

Millenials buying houses ?

They have no money Garth

You have data to support?

Lots of folks were wrong about RE, so you’re not alone

#88 Doug t on 08.31.20 at 8:49 pm

I have 2 friends in victoria who are teachers – they are sooooo fed up with the union and BS – but hey that’s a given – I had to suffer the CAW for years at GM back in the day and they were useless at best

#89 ImGonnaBeSick on 08.31.20 at 8:51 pm

#73 Ponzius Pilatus on 08.31.20 at 7:21 pm
#54 ImGonnaBeSick on 08.31.20 at 6:18 pm
#47 Ponzius Pilatus on 08.31.20 at 5:52 pm
After watching the riots in Portland, I finally find the real use of flag draped F-150s

—-
Spoken like someone that’s never done a day’s work in his life…
———-
30 years in Accounting. 45 sick days.
What’s your claim to fame?
——

Haha.. are we really going to do this? I think you just proved my point. Those little hands are only good for counting money…

#90 UBI man on 08.31.20 at 8:52 pm

Will everyone get “Universal Basic Income”, even if you have a stable job? Or is it just for those who don’t want to work?

#91 Bark on 08.31.20 at 8:52 pm

Also mortgage deferrals are a huge factor. 11% of Canadian mortgages are currently being deferred (21% in Alberta). The 6 month limit for many of these deferrals is right around the corner.

#92 DON on 08.31.20 at 9:09 pm

#58 Dirty Dan on 08.31.20 at 6:30 pm

“I have been diligently watching CNN”
******
Yikes! to the diligent part.

#93 OracleOF-SIX on 08.31.20 at 9:10 pm

“If we can understand why this is happening, perhaps we can determine if it’ll last.” – The reason is simple, O wise one:

During such frightening time when unpredictability rules, Homo-sapiens are genetically programmed to run to the comfort of womb. (Home) so rentals & condos are out. Home-Sweet-Home is in.

‘Education’ (through blogs like this) is futile.
Hormones rule!!

#94 DON on 08.31.20 at 9:17 pm

As the summer holidays end, the news gets worse. zit has been there all along, but summer fun was in the air. Now facing an uncertain fall…on mant levels. I love hopium…not opium and reality is always in the background. I guess the next question is: How long can people tread the financial waters? Will the banks tighten credit as things cascade?

Consumer spending is dipping in most countries around the world. China has a bad loan issue with their banks.

#95 Dirty Dan on 08.31.20 at 9:18 pm

Garth, I’m having an existential crisis!

I am currently on the same side as Justin Trudeau regarding an ethical issue. Something isn’t right.

Justin Trudeau has condemned the destruction of the John A. McDonald statue.

https://www.youtube.com/watch?v=4ce3yzxo-dU

Destroying John A. McDonald statue = vandalism.
Painting the Trudeau statue with black paint = funny political statement.

#96 tccontrarian on 08.31.20 at 9:19 pm

For a non-virus blog we get a weekly dose of into on…yes, the virus. Not that I’m complaining cuz it’s obviously relevant to finances, directly or indirectly.

Fair to say this:

FOVO (fear of virus overexposure), has led to FOMO … which will ultimately lead to …

—> FOFOrclosure

So many abbreviations to make life easier. Time to get my a MAGA hat (Make Alabama Great Again).

tcc

#97 SeeB on 08.31.20 at 9:21 pm

Hey Garth, great post. This change of tune in the Fed makes me more nervous the more I think about it. I’d welcome input from anyone that may know more (no conspiracy stuff, just speculation

Apparently JPow has noted that the increase amount of inflation he’s OK with is 2.25% to 2.5%:

https://www.cnbc.com/2020/08/27/powell-announces-new-fed-approach-to-inflation-that-could-keep-rates-lower-for-longer.html

“While Powell did not specify how much higher he’d like to see inflation run, Dallas Fed President Robert Kaplan later in the day told CNBC that he would be content with a range around 2.25%-2.5%.”

The assumption is that increased inflation will in the long term lead to upward wage pressure once people get back to work.

1) How bad could this affect people in the paycheck-paycheck cadre in the short term? I assume that prices increase faster than wages

2) How might the Fed address the paradox of the past several decades where real wages have not kept up with inflation:

https://www.pewresearch.org/fact-tank/2018/08/07/for-most-us-workers-real-wages-have-barely-budged-for-decades/

3) Does this anticipation of returning to “Full employment” factor in an increasingly gig-reliant and automated economy?

https://www.reuters.com/article/us-amazon-prime-air-idUSKBN25R2NG?utm_campaign=trueAnthem%3A+Trending+Content&utm_medium=trueAnthem&utm_source=facebook

#98 tccontrarian on 08.31.20 at 9:22 pm

Should read:

“FOFOC (fear of “foreclosure”). Has a certain sting to it!

tcc

#99 crowdedelevatorfartz on 08.31.20 at 9:26 pm

@#72 Puttering Ponzie
“Sorry, CEF I accused you of not being educated enough to make statements about how the Nazis came to power.
I was wrong, you must have read “Mein Kampf”.”
++++

Then you embrace lawlessness and anarchy?
Let me guess…… The Bader Meinhoff gang were your heroes because they were against the establishment?
Regardless of how many they killed?
Ironic when you consider most of the current protesters are CERB funded sheeple that will flock to the nearest protest to join in with any group of furry faced fellow vandals , visigoths and vagrants.
Mindlessly following the orders of “leaders” who are happiest when they destroy everything that others have.
Just remember to wear a hairshirt, braid your beard, and clip your toenails before you change your sandals.

#100 Can of cash on 08.31.20 at 9:30 pm

what is happening with teachers union? Globally, one of best paid teaching, holiday+pension gigs. All safety measures have been provided-ETC. WHATS THE DEAL?

#101 MF on 08.31.20 at 9:41 pm

0 Can of cash on 08.31.20 at 9:30

The “deal” is:

-it’s tough ironing out the kinks when it comes to having a group of strangers expected to come into close contact for 7-8 hours a day during a global pandemic.

Health is number one. Money is not.

MF

#102 TurnerNation on 08.31.20 at 9:45 pm

#9 Legal Beagle it’s already here:
https://tinyurl.com/y2z22lcn

Comply comply comply. Just to weeks.

#103 IM in C on 08.31.20 at 9:54 pm

Reading about those 800,000 dwfred mortgages coming due this fall, I suddenly understand why Trudeau is trying to engineer his own defeat. It is so he can call an election and present himself as the good guy. Lets see if Jagmeet Singh and the NDP will be stupid enough lead a non confidence motion this fall

#104 forgotmyusername on 08.31.20 at 10:15 pm

#58 Dirty Dan on 08.31.20 at 6:30 pm

I have been diligently watching CNN. Aside from a few isolated incidents of right-wing racist homophobic trump racists there has been nothing but peaceful protesting in the US. If I’m in some sort of “media bubble”, than clearly it is quite large and far reaching.

————-
Whoops, at first I took that comment seriously. Sorry, my bad!

For those who only watch CNN, try broadening your diet.

Andy Ngo does good reporting on instances where protest gets over-taken by violence from the left. No doubt Ngo has an agenda too. (The left certainly hates him.) But I feel his reporting is usually professional. Heroic, even.

https://twitter.com/mrandyngo?lang=en

#105 TurnerNation on 08.31.20 at 10:20 pm

People need to understand how asymmetrical warfare works. It’s on all fronts. Every aspect of our lives were changed when the New System dropped that Monday in March.
There are no hard targets. Two weeks morphed into curves morphed into R values and now whatever they can hit they will.
As with the Iraq/Afghan invasion. Goals are? Endless occupation and chaos.
Doesn’t matter. Troops stood by as Iraq museums were looted and destroyed.
Today cops are ordered to stand down as statues are toppled by paid protestors. Same same, destruction of culture is the goal.

We will be kept off balance into Harvest season.
Yes the next few months they are coming for our assets (more taxation and home repossession), childrens’ school and childhoods, our jobs via 2nd wave of bankruptcies.
There are no targets. We are the targets.
They hate our way of life.
This is WW3. All countries are involved.

#106 Math always gets in the way on 08.31.20 at 10:53 pm

Do you know what else is a human right globally and has happened in many countries from Venezuela to Chile to Cuba to Argentina to Zimbabwe, U.S.S.R., etc. etc. starvation, eating scraps out of the garbage, eating rats and cats etc.

This will be coming to a neighbourhood near you if you think your socialist, communist, marxist utopia is the best thing since sliced bread. Millennial Realist and other millennials since you like experiences over purchasing or getting goods, a growling in your stomachs will be a new experience you can feel as you better be careful what you wish for. It always comes down to learning the hard way for young, inexperienced people that think they are smarter than the average bear.

#107 YouKnowWho on 08.31.20 at 11:06 pm

#69 Ronaldo

Thanks Ronaldo.

Few things.
1. That all happened before this federal Housing is a Human Rights law.
2. That all happened before Covid changed things, kicked up unemployment and put a lot of people’s housing at risk.

I think that situation 10 years on may play out differently if challenged now with this law on the books. Again, we have to wait for it.

Of course the landlords have much more resources to lobby and higher better lawyers – so whoever takes this on to argue for the Human Right will be up against it possibly. But it seems that momentum maybe with them in a big way now.

#108 Looking up on 08.31.20 at 11:13 pm

#71 A Decade On and No Change on 08.31.20 at 7:13 pm

Every year there is some new policy change or demographic time bomb which is supposed to tank the market. And every year the prices miraculously rise.

The reality is that those who were financially prudent and rented and invested the difference between owning and renting have faired poorly to those that had no assets, jumped into the real estate market. Their equity far, far overshadows any modest 5% gains in un-leveraged portfolios. Their net worth far outweighs an renter with a balanced portfolio.

The masses have been rewarded with an ever inflating asset, while the cautious, financially prudent, and contrarians have been slaughtered.

—————-

So true but you always get people who pull out a chart of the s&p and say “well the s&p returned more than housing”. But you don’t get the benefit of leverage when you throw $1000 a month into the S&P vs buying a house. All the people I know who did extremely well did it with real estate. Everybody I know who invested in the stock market did so so or just OK. I’ve invested in both over the years and no surprise real estate did wayyyyyy better. If I could go back I would have put every dime in real estate and not wasted my time (including investing courses etc) with the stock market.

Oh course the big caveat here is that “in the future the past is always obvious.”

#109 the Jaguar on 08.31.20 at 11:30 pm

Garth, people are going a little ‘Meshugana’ on the blog.
They’re running ‘amok’.
You need to send out the border collies. And if you need to borrow my riding crop, just say the word.

#110 Paul on 09.01.20 at 12:11 am

#74 Cottagers STAY THE HELL AWAY! on 08.31.20 at 7:25 pm
Did you enjoy your weekend up here, all you southern inbred hillbillies?

Now we have to pick up all the crap you’ve left behind, piles of garbage everywhere.

https://www.cbc.ca/news/canada/london/huron-county-runner-litter-1.5701002?__vfz=medium%3Dsharebar

Enjoy our countermeasures, coming soon.
————————————————————————————————
Go old school! I looked at the link no BEER bottles.
Put a deposit on all take out cups,bottles,cans
= Huge drop in litter.

#111 Ace Goodheart on 09.01.20 at 12:15 am

RE: #62 Teachers Lives Matter on 08.31.20 at 6:45 pm

Numbers are spiking – look at BC. Huge virus numbers hitting.

Yup.

To date, a grand total of 208 people have died in BC from COVID.

In 2018, 282 people died from car crashes in BC.

Better shut down those roads, and ban everyone from driving.

More people are dying from car crashes in BC, than from COVID, currently.

This is a Province wide crisis.

I wonder if the Provincial government knows about this?

#112 fishman on 09.01.20 at 12:23 am

Van town wants to thank all you Easterners for contributing small (but many) dollars to the big boys. Netflix, HBO, Walt Disney, Amazon. They are dumping big cash out here. They need content to feed the hungry mouths for movie & popcorn night in quarantine. We got the talent, the studios, the unions, the Teamsters to make it happen. And Happening it is.
But the big boys are the B.C. lumber companies. Prices in Feb were $260/thousand & they were treading water. Now its pushing $1000/thousand. And its a reverse tariff. Higher the price,lower the softwood tariff. I know hick interior towns got mills pumping out 750,000/day/2 shifts. At $600/thousand profit. Thats half a million/day profit. Plus they bought all those mills down in Georgia & Alabama. Made them efficient. B.C. Lumber Barons. Just like the old days.

#113 CERBNation on 09.01.20 at 12:52 am

Tax freedom day is heading to Dec. 31st………….. this is just wealth transfer…..

https://www.theglobeandmail.com/business/article-liberals-revised-covid-19-emergency-benefits-resemble-a-national/#comments

#114 Dr V on 09.01.20 at 1:01 am

90 UBI

Dictionary definition of universal

” including or covering all or a whole collectively or distributively without limit or exception ”

Beware the various schemes being contemplated.

#115 When everyone goes right, go left on 09.01.20 at 2:05 am

Emotions at their best here with society unraveling, and everyone trying to hold on to somehow remain relevant with everything else built up in their life crumbling.

Its amazing how a more in depth dive into the human psyche, can not only be calming (preventing you from doing something irresponsible financially), but also help explain what is happening in the macroeconomics.

Another interesting theory on this is that ppl who have learned from failure (business owners, wise bloggers, etc) or have come from nothing make better financial decisions and are calmer in these situations (as they are not afraid to be temporary irrelevant, they have been there and believe).

#116 Drew on 09.01.20 at 2:52 am

You must not have been in Toronto recently because it seems pretty busy again to me. In April it was a wasteland; I miss April

#117 yvr_lurker on 09.01.20 at 3:03 am

With the theme today on nesting, one related new trend brought on by Covid is the idea that business travel and travel to conferences are unlikely to return to previous levels. In my field, for the past 4 months I have been going to “conferences” by walking from my basement to the office on the third floor. Many of my colleagues are in the same boat, and frankly it has been okay. No need to zoom around (pardon the pun) on airlines to various conference venues, spend oodles in overpriced hotels and restaurants. Sure a little is lost in the translation with lack of F2F, but overall the new experience is okay and much more convenient. Finally, I see that the airlines in the US are now waiving change fees as they realize that they must make some effort to entice people back on board. Air Canada however has been allowed by our Gov’t to abuse the traveling public with their no Covid refund policy and other abuses. If some of these airlines file for bankruptcy… oh well…. I don’t see the airline industry snapping back to the way it was pre-covid, at least for work travel.

#118 It’s getting worser on 09.01.20 at 3:52 am

DELETED

#119 Slack Daddy on 09.01.20 at 4:09 am

“REITS on sale” I agree. I own REI. UN and it’s down alongside others, but, I have continued hold and add to DCA and collect a sweet 9% divvie paid monthly which allows me to buy more. Look at the chart, nothing REI specific.

On March 23rd everything tanked, panic !! But, consolidation is good, coiled spring if you like. Ed Sonshine is the smartest man in the space. His portfolio mix is diverse, commercial and residential. REU also holds the leases on more outside access than mall walk. Distancing etc much easier to fill.

OK, that’s my two cents. Garth, anyone have any other sweet undervalued REITS to confer? I’m buying more defense as we go into the fall.

#120 crowdedelevatorfartz on 09.01.20 at 6:59 am

DELETED

#121 crowdedelevatorfartz on 09.01.20 at 7:09 am

@#110 Paul
“Go old school! I looked at the link no BEER bottles.
Put a deposit on all take out cups,bottles,cans
= Huge drop in litter.”

++++

What decade are you in. Cans have a deposit.
As for plastic “solo” cups….they should ( and eventually will) be banned.

“Stay-cation” tourists that dont give two shites about the environment.
The exact same issues in BC.
From Tofino beaches to Interior campsites.

Slobs bring all their crap and party. Weekend over…..leave their garbage to rot.

Nothing new.
I watched a news story a few years back about the 2 day clean up after a 3 day Country & Western Concert in PEI. Dump trucks full of tents, sleeping bags, coolers, bottles, cans, food, plastic bags, human feces…..on and on and on.

What do we expect from a generation that has had their parents picking up after them their entire lives?

……..and a one and a two and a three……….. outraged response………

#122 akashic record on 09.01.20 at 7:45 am

Government has spend privilege. Bank of C has print privilege. Banks have interest privilege. Together they establish a systematic, institutional ratism and debt slavery. Debt slaves have human rights privilege.

It’s been a privilege to know you all.
Now, let me breath and live my life. Free.

#123 BillyBob on 09.01.20 at 8:14 am

#77 Not a Member of the C.S.Lewis Society on 08.31.20 at 7:33 pm
#68 Nonplused on 08.31.20 at 6:56 pm
#8 Don Guillermo on 08.31.20 at 3:33 pm

When CS Lewis wrote that, the hydrogen bomb had not yet been invented and people thought about Hiroshima and surviving for a few months in a bomb shelter, then returning to life as normal minus a few cities…
—————————————————————
Good answer to the logic of C.S.Lewis. His thoughts on the atomic age were as flawed as many of his other arguments.

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

I suppose it would seem that way when you totally miss the point. Which both you and Nonplused did completely. At least Nonplused backtracks a bit in #84.

Read the passage again. There’s absolutely nothing in it about post-disaster, whether nuclear or otherwise.

“If we are all going to be destroyed by an atomic bomb, let that bomb when it comes find us doing sensible and human things—praying, working, teaching, reading, listening to music, bathing the children, playing tennis, chatting to our friends over a pint and a game of darts—not huddled together like frightened sheep and thinking about bombs. They may break our bodies (a microbe can do that) but they need not dominate our minds.”

It’s about not living in fear of a threat about which one can do almost nothing about, and getting one with one’s life as best as able.

How is that not absolutely applicable to the present, or any age? Society is so mentally fragile, so utterly lacking in resilience now.

Don’t really care what your opinion is of Lewis, but at least make a cogent argument if you disagree.

#124 paulo on 09.01.20 at 8:17 am

#110 Paul:

Thats a good idea!

#125 TurnerNation on 09.01.20 at 8:20 am

Here comes another attack: media predictively floating the idea of more lockdowns in Quebec.
Did ya notice the areas with the strongest most homogenous culture get locked down the most? Italy, USA, Australia and Quebec. Bringing them to heel. Bey they won’t try separation again.
I just wonder where at all the sick people? People hacking, coughing, long lines at walk in clinics; pharmacists running low on medications?
Boy our global elites got us divided and on the run as they get ready to drop global communism/new green deal.

#126 crowdedelevatorfartz on 09.01.20 at 8:34 am

@#125 # Turnernation

“I just wonder where are all the sick people? People hacking, coughing,…”

++++

Standing 3 meters from every doorway …lighting another cigarette……..

#127 YouKnowWho on 09.01.20 at 8:37 am

#106 Math always gets in the way

Little bit of hunger is not a bad thing.
Lean everyone out, reduce obesity and diabetes.
Covid is having a field day thanks to those two alone.

Who made us so obese and diabetic?

Buildings full of scientists working in addictive substances to put in the food to keep people eating and drinking more of that processed sweet garbage, perhaps?

#128 YouKnowWho on 09.01.20 at 8:45 am

#122 akashic record

The more people are on debt the more tempting it is.

Look, this guy got into crazy debt and look what happened? He got a house and a Bemmer. Why aren’t you in debt? Look at the interest rates! You’re crazy not to be ears deep in debt.

It’s really weird. If you want none of it you have to really up your resistance to it, because there is this coordinated effort it seems to get you in debt.

Garth talks about FOMO, but the FOMO is also about debt. The more you wait, the more debt you will need, so get into debt today! ASAP! Before you need to borrow more.

It’s a really weird thing this debt push.

#129 TurnerNation on 09.01.20 at 8:45 am

A glimpse into the future:

1. Independent pub closing. John St. in Toronto Almost beside it is a branded SIR Corp (SIR.TO) pub. Down from this is new condos. Just a matter of time:

https://www.blogto.com/eat_drink/2020/08/toronto-pub-closing-landlord-rent/

2. 15 min walk away a long standing independent pub closing on Front St. Beside it is…a SIR Corp (SIR.TO) branded pub.

https://www.blogto.com/eat_drink/2020/08/toronto-pub-closed-35-years/

3. Another pub closing…what a cultural bomb that was dropped. Large chains left only.

“Another pub, Failte Irish Pub, recently closed after 22 years in Mississauga.”

#130 TurnerNation on 09.01.20 at 8:47 am

^ Correcting it is SRV.TO not sir.to. http://www.sircorp.com/

#131 Sara on 09.01.20 at 9:10 am

#120 crowdedelevatorfartz on 09.01.20 at 6:59 am
DELETED

Keep it up stinky. And soon you will join your idol SA.

#132 the Jaguar on 09.01.20 at 9:18 am

@#123 BillyBob on 09.01.20 at 8:14 am

Thank goodness BillyBob ‘gets it’. That indeed was the intent of the message…

#133 NoName on 09.01.20 at 9:29 am

I was reading this yesterday about mandatory investment accounts for kids. Kind of interesting idea plus he thinks it should be funded buy gov. Not parents, I guess it would be a good book if parents would be able to top up…

https://www.msn.com/en-us/money/savingandinvesting/billionaire-bill-ackman-says-mandatory-investing-accounts-for-every-us-child-could-combat-wealth-inequality/ar-BB18ydu9

#134 crowdedelevatorfartz on 09.01.20 at 9:30 am

@#131 Sara’s safe space
“Keep it up stinky. And soon you will join your idol SA.”

+++

Oh Sara.
Hovering like a Politically Correct vulture.
What a boring life you live.
And you wish this blog was so boring you would look exotic… :)

It you don’t poke the bear every once in a while you’ll never know whats funny , whats politically correct, and whats DELETED.

Now, get back to making those posters with the zippy one liners and load up on spray paint….There a protest somewhere to join!

#135 Do we have all the facts on 09.01.20 at 9:30 am

In 2016 the Parliamentary Budget Office analyzed the demographic profile of Canada and projected that new household formations would decline from high of 209,100 new households in 2016, to 186,900 in 2019, to 183,200 in 2020, to and 176,700 new households in 2021.

With the drastic reduction in net in migration in 2019 the number of new households created in 2020 and 2021 will in all probability fall below 175,000.

The creation of new households is the key factor in maintaining the demand for housing. It is certainly possible to borrow demand from future years by lowering interest rates and adopting a more flexible approach to credit. Without a substantial increase in immigration however you cannot accelerate the creation of new households and new demand for housing.

In order to generate an average of 40,000 home sales per month across Canada a minimum of 20,000 purchases must be made by first time home buyers each month. Financial institutions seem to be bending over backward to find ways of generating sales today without concern for what will happen when demand related to new household formation disappears in the future.

CMHC has issued warning after warning to financial institutions about what might happen when a reduction in future demand hits home. These warnings have been ignored and most Canadians still believe that house prices will continue to increase as demand shrinks.

In 2016 the PBO also projected that the net addition to the total housing stock of Canada would decline from a high of 199,300 units in 2017, to 182,900 units in 2018 and to 171,700 in 2019 and 2020.

Well this message was not received by the construction industry who continued to add 190,000 new units to the total housing stock of Canada in 2018 and 2019. In December 2019 there were over 270,000 dwelling units under construction across Canada and in June 2020 CMHC projected a total of 245,000 housing starts in 2020.

All the chatter about a shortage of supply driving up prices seems incongruous with what is actually happening on the ground.

All I can offer as advice to prospective home owners is to spend a few hours investigating why CMHC is advising all parties to exercise caution.

#136 45north on 09.01.20 at 9:41 am

Earlier today the federal regulator dropped the hammer, telling banks any new deferrals they grant will be treated as non-performing loans, requiring them to raise more capital. In effect, it signals the end of a six-month period in which almost 800,000 families stopped paying their obligations.
The program will be phased out over the next 90 days with the bulk of deferrals ending next month. “Banks are now in a better position to employ their business-as-usual alternatives to support troubled borrowers,” the regulator said. In general that means moaning and weeping.
It’s begun.

which supports what I said on Saturday

The banks are not waiting for Hilliard MacBeth to tell them they’re unprepared. They’re going to crack down hard in September.

the real estate feeding frenzy is unlike anything we’ve seen before – people buying irrationally at the very peak of the market, without resources to back them. We’ve said it before and the market kept run on. People bought irrationally without resources to back them and the market covered for them.

I’m thinking of a family who just bought in Ottawa. They also own a condo in downtown Toronto. That’s about all I know. Once the market has turned, they’ll sell the condo.

#137 kc on 09.01.20 at 9:51 am

Garth,

How do you read this drivel every day and keep your sanity?

#138 BillyBob on 09.01.20 at 9:53 am

Speaking of Sail Away, I must have missed the drama about how he was apparently banned but is that a permanent thing or is he just staying away voluntarily?

Like or dislike he was a net addition of intelligence to the comments.

And Dog knows there are more than enough left around on the other side of THAT trade…

#139 ImGonnaBeSick on 09.01.20 at 9:55 am

#131 Sara on 09.01.20 at 9:10 am
#120 crowdedelevatorfartz on 09.01.20 at 6:59 am
DELETED

Keep it up stinky. And soon you will join your idol SA.

—–

What exactly do you contribute here?

#140 Captain Uppa on 09.01.20 at 10:05 am

This “deferral cliff” is an unknown. How many of those deferrals were stupidly done by people who could easily afford it but chose to keep money instead? I bet it’s quite a bit.

Further, people who have been hit hardest by job loss are in the service and tourism industries where wages are not high. It is likely that most of those hardest hit were renters.

So this deferral cliff could be a big nothingburger. And in my humble opinion, is indeed one.

#141 Dharma Bum on 09.01.20 at 10:10 am

#70 Flop

Get to Salt Lake City, head off on a 45 degree angle towards Moab and check out Arches National Park, before continuing on to Durango, and then start working our way up towards Denver.
——————————————————————–

Moab is stellar. Arches is phenomenal. It’s in the top 3 of my favourite U.S. national parks. It has a ton of easy access scenic viewpoints if you don’t feel like hiking for miles. But if you do, it has a number of great hikes to get to some awesome vantage points.

Take plenty of water if going in the summer. People have died there from dehydration. Literally.

If you’re not into GPS, I’ve got a stack of ratty paper maps you can use.

On another note:

“And yet, a real estate feeding frenzy. Debt levels are surging. Bidding wars, blind auctions, bully offers and people grabbing houses they’ve only Zoomed or FaceTimed. It’s all happening. It’s real. It defies reason.” – Garth
——————————————————————–

Eh? What else they got to do?

#142 Dharma Bum on 09.01.20 at 10:17 am

Another execution in L.A. yesterday.

BadBoys Bad Boys, Whatchya Gonna Do? Whatchya Gonna Do When They Come For You?

https://www.youtube.com/watch?v=5coefdzLlYc

#143 Love_The_Cottage on 09.01.20 at 10:21 am

#135 Do we have all the facts on 09.01.20 at 9:30 am
…All the chatter about a shortage of supply driving up prices seems incongruous with what is actually happening on the ground.
____________
In addition it comes back to location, location, location. Single family homes and homes in cottage country in Ontario are in demand, downtown condos are not. I don’t see this changing in the next 12-24 months.

#144 the Jaguar on 09.01.20 at 10:25 am

@#138 BillyBob on 09.01.20 at 9:53 am

He got ‘suspended’, which appears different than ‘banned’. Maybe being held in one of the cells or vault beneath the old BeeMo branch in Lunenburg. But he could also be out with his dogs hunting rabbits with Elon Musk.

#145 Re elect NO ONE on 09.01.20 at 11:15 am

The confession of medical fraud by the CDC didn’t seem to reach the ears Doug Ford and T2.
Are they in a bubble with their 10 yr old scripts? Conclusion: we will be getting the full Australia treatment this fall.

#146 the Jaguar on 09.01.20 at 11:16 am

#144 the Jaguar on 09.01.20 at 10:25 am
@#138 BillyBob on 09.01.20 at 9:53 am

He got ‘suspended’, which appears different than ‘banned’. Maybe being held in one of the cells or vault beneath the old BeeMo branch in Lunenburg. But he could also be out with his dogs hunting rabbits with Elon Musk.
+++++++++++++++

Breaking: Just heard from reliable ‘Sources’ that Sail Away is actually engaged with other ‘Patriots’ in a mission to ‘Liberate’ the statue of Sir John A MacDonald from his current resting place in Montreal and transport him out West where he will be reinstated in place as a historical figure of Canada’s proud past. Mission underwritten and financed by UCP.

#147 Yukon Elvis on 09.01.20 at 11:17 am

#144 the Jaguar on 09.01.20 at 10:25 am
@#138 BillyBob on 09.01.20 at 9:53 am

He got ‘suspended’, which appears different than ‘banned’. Maybe being held in one of the cells or vault beneath the old BeeMo branch in Lunenburg. But he could also be out with his dogs hunting rabbits with Elon Musk.
……………………….

Bread and water. Chains. Darkness. Yah I think that’s it.

#148 Don Guillermo on 09.01.20 at 11:25 am

#132 the Jaguar on 09.01.20 at 9:18 am
@#123 BillyBob on 09.01.20 at 8:14 am

Thank goodness BillyBob ‘gets it’. That indeed was the intent of the message…

Absolutely. Cheers!

#149 Felix on 09.01.20 at 11:34 am

That dogawful mutt is trying to suffocate the human!

#150 mnpr on 09.01.20 at 11:45 am

Yup…. S.A. one of the intelligent contributors to this blog I enjoy reading. Sure, he could maybe be a bit insensitive at times (but I like fartz’s comment about poking the bear)…. but can’t help thinking our gracious and very appreciated blog host went a bit too far, into cancel culture, in suspending him.

#151 Vancouver Brit on 09.01.20 at 11:58 am

Am I the only one who feels like the people who are primarily affected by unemployment due to Covid are those who aren’t in the real estate market anyway?

Those most affected work in retail, customer service, food/beverage, tourism etc. These are not typically the kind of people who can afford to buy homes either way, particularly in major cities like Vancouver/Toronto where prices are completely out of their income bracket.

Those who can afford to buy homes have mostly been unaffected financially in my anecdotal experience.

#152 Bill on 09.01.20 at 12:03 pm

Pensions
Pubilic vs private…we certainly know whos taking care of #1.

https://mikesmoneytalks.ca/its-going-to-cost-you-big-money/?mc_cid=2d95beab47&mc_eid=3a926e1db2

#153 IGV on 09.01.20 at 12:39 pm

Well when the Fed Reserve is injecting liquidity of 44% of the entire US GDP things will move.

Wonder how that will keep going? Oh yeah—it cant.

Once in a generation opportunity to short the market.

#154 Attrition on 09.01.20 at 12:53 pm

The unrest we’re seeing is intentional, transparent. Sow chaos, use said chaos to smear the incumbent, bask in election glory.

An approach that’s Roman in its simple elegance, Greek in its tragedy, and as plain to see as Mount Rushmore.

But once you unleash violence and fan the flames, you usually can’t control it. Either it burns everything in its path, or it gets put down by force.

Either way, the dear Dems win. To blame the violence and ‘unrest’ (what a word) on Trump is a deplorable ignorant and wishful thing. Disguising, actually.

So I suppose those who pull the triggers, toss the bricks, or light the flames are innocent because they were pure and purely motivated in their hatreds, and…Daddy Trump made them do it?

That the majority of people seem to think this way has me longing for a great reset, but not the green one we hear so much about.

This is what happens when you raise a couple generations to be blind to the threat that democracy embraces: the threat of death from within. Democracy provides its enemies with the tools of its demise.

It should be up to the electorate, us fine upstanding and democratically empowered citizens who affect change with our votes and not our fists, to defend the system because we’ve been educated and we know where the slow slide to socialism leads.

Every.

Damn.

Time.

It leads to ‘unrest’, authoritarianism, less representative governments, un-elected officials, moral and thought policing, scarcity, bread lines, poverty and regression.

We’re supposed to not only know this, but know how to react to it, how to neutralize it, how to expunge it from our democracies.

But we’ve lost the knowledge, decided to give in, or are choosing to pretend that what’s happening all around us–cancel culture, identity politics, state sanctioned oppression of freedom of association and speech, the rot at our institutions–isn’t happening or isn’t a threat to the democracy that has, for the first time in history, created and grown a broad middle class.

As a capitalist and democratic society, we sorely need to collectively grow a pair of lady balls.

Next election, protest the protestors and their Marxist tactics by voting with your eyes open.

#155 Don Guillermo on 09.01.20 at 12:55 pm

Incredible!!

https://thepostmillennial.com/trudeau-blames-extreme-right-for-dividing-canadians-after-john-a-macdonald-statue-toppled

“We’ve seen, following that, people on either side of the spectrum trying to use these elements as a way of furthering debates,” the prime minister said, only in French: “I think that we’re seeing, particularly on the extreme right, that they’re trying to start culture wars and divide Canadians on issues such as that.”

#156 Do we have all the facts on 09.01.20 at 12:56 pm

# 143

Housing demand for higher priced units in desirable locations is often based on a chain of sales that tracks back to a first time buyer and new household formations.

Wealthy immigrant households contribute to demand but the purchase of most homes valued at $800,000 or more involve a upgrade by existing homeowners.

No matter how you look at the current flurry of activity the sale of homes in desirable locations will slow down as demand for all types of units declines to reflect fewer qualified first time buyers and a reduction in new household formations.

#157 snapshot on 09.01.20 at 1:03 pm

No one I know is sick. No one I know is out of work who doesn’t choose to be. No one I know is in any insurmountable debt. No one I know discusses the news regularly. Most discuss local events, gossip, gardening, weather, and wildlife. The biggest threat to our way of life is the bylaw officer and a meddling regional district. I am considered an agitator because I read this blog and relay pertinent info. Discussing personal finance is still considered gauche among many. I live in a small Canadian agricultural community north of 51° with a diverse demographic. As I type, a platoon of civic workers and machinery are cleaning out ditches and sprucing up the neighbOURHOOD. I wore a mask to the bank, not with any concern, but because I could.

#158 Think Botanicals on 09.01.20 at 1:24 pm

It seems to me that this excitement in the real estate market during the quarantine period is all a baseless statement. It seems that someone benefits from the growth of the real estate market. Therefore, they spread gossip, write such sharp headlines. The real estate market can only grow if the demand for housing is greater than the supply. Let’s think logically. Who during a pandemic, when everyone is saving, who buys housing during such a period? Are there such people among your acquaintances? Not among mine!

#159 Paul on 09.01.20 at 1:26 pm

#121 crowdedelevatorfartz on 09.01.20 at 7:09 am
@#110 Paul
“Go old school! I looked at the link no BEER bottles.
Put a deposit on all take out cups,bottles,cans
= Huge drop in litter.”

++++

What decade are you in. Cans have a deposit.
As for plastic “solo” cups….they should ( and eventually will) be banned
————————————————————————————————
I was referring to soda cans, Coke gave Toronto One million dollars to help start the recycle system. When they switched to mostly cans and plastic (no deposit) from reusable glass bottles. Brewers Warehouse gets around 95% return rate and yes you could put a deposit on Tim Horton’s and McDonald’s cups ect. If people chucked the out the window someone would pick them up.

#160 crowdedelevatorfartz on 09.01.20 at 2:03 pm

@#159 Paul

Ontario doesnt pay 5 cents for pop cans and plastic bottles?
Wow!

Yep.
Put a deposit on em like BC…. the binners will break into your garage for them.

#161 Looking up on 09.01.20 at 4:19 pm

#156 Do we have all the facts on 09.01.20 at 12:56 pm
# 143

Housing demand for higher priced units in desirable locations is often based on a chain of sales that tracks back to a first time buyer and new household formations.

Wealthy immigrant households contribute to demand but the purchase of most homes valued at $800,000 or more involve a upgrade by existing homeowners.

No matter how you look at the current flurry of activity the sale of homes in desirable locations will slow down as demand for all types of units declines to reflect fewer qualified first time buyers and a reduction in new household formations.

——————-

You would think……