Patience

In Kitchener-Waterloo last month house sales grew 28%. The price of a detached place was 35.4% greater than in February of 2020, when you’d never heard about Covid and couldn’t imagine everyone in the bank looking like they were holding it up. Hundreds of new families trekked 120 km down the killer 401 from the Big Smoke and bought in the middle of winter. In a recession. And a public health crisis.

But this is 2021. We’re all insane. As mentioned here yesterday, it’s a pan-national weirdness. And with each day that passes the odds grow of an intervention. “If Canadians are taking out permits and buying resales at such a pace during winter then what does that say when the key spring housing market and vaccines arrive?” asks Scotia Derek Holt. “Policy is arguably overly easy and changes may be afoot in a spring budget.”

Anti-house measures and rising mortgage rates? Game-changers?

Holt is just one voice posing the same question: how can government ignore this? Cheap mortgages, WFH, aggressive nesting, urban phobia, low inventory, demographics – it’s a perfect storm. A few more months of this and real estate prices will well and truly be beyond the means of the middle class. Even the lawyer class.

We have two field reports.

“I am a reader of the blog and a horrified spectator of the current madness in real estate in Toronto (and everywhere else too),” says Alan.

Now nobody will shed many tears for a 33-year old guy, one half of a couple (both lawyers) with a combined income of a bit under $500,000. They save $180,000 a year and have six hundred grand invested in RRSPs, TFSAs and non-registered money. The guys rent a 700-foot condo for $1,300 a month but dream of owning a house.

“Here’s the kicker. We are tired of living in our condo. The space is not big enough and it would be nice to have a place of our own. There is no denying there is a hugely irrational element to that desire given where prices are in Toronto. I am the first to acknowledge that it is total madness out there. People are buying so indiscriminately and the kind of shitboxes that are selling over a million or 1.2 or 1.4 is stunning and downright frightening. None of it sits well with me.

“… but there is also that sense we have 1) that we will be priced out of the market; 2) that we have the opportunity to borrow at historically low rates now; and 3) that we want to start the next stage of our lives in a place of our own. (As a gay couple that sees every straight person just treat those milestones casually and nonchalantly, it is also a bit vexing not to be taking that step as well.) There is a strong emotional part of this, no doubt about it.

“All of that said, I want to be smart and thoughtful and responsible. I don’t want to do something monumentally stupid. If we were to buy a place, we would plan to put down $300K and cap ourselves at 1.5M. Basically that will get us a small semi in the east or west end, which is a lot more than we have now. But buying at what should, by any logic, be the top of an already inflated market is scary. On the flip side, I would be pissed as hell if we got priced out completely.

“I know our situation is not unique. It is probably the situation of every young professional couple in their 30s looking to get into the housing market. I don’t want to get all existential about it, but it does kind of feel that way at times.

So, what do you think? Should we wait six months once things calm down (hope springs eternal) and there’s more supply on the market? Should we wait even longer? Should we forgo a home completely and stay where we are?”

Lest you believe only rich, urban, professional Millennials come here to moan, meet Jason. “I live in a $30,000 mobile home illegally on a quarter section somewhere in Alberta,” he says.  “We plopped it here a year ago thinking that home prices will be cheaper in the future and we’ll buy or build a house then. Boy we’re we wrong.”

“I’m laying under my trailer right now trying to find the mouse that keeps me awake at night and it’s here that I find myself reaching out to you. We can live here for another year but then we have to either build a house on land that I own or move the mobile on said land or buy something. I guess we could rent but not much comes up for rent close by and is usually too much money. We farm so we need to be somewhat close.

“I have for assets $250,000 cash and $40,000 as well a quarter section of land and some bison.

“Here’s my question: you and many others forecast inflation in the coming years so wouldn’t that just continue to put upward pressure on homes and building materials? Wouldn’t buying now be wise if inflation was guaranteed? Alternatively if interest rates rise and home prices come down won’t it still be more money to buy later because the cost of borrowing is rising?

“My cash is losing value from Trudeau printing more everyday, the stock market is a bubble. What do I do?”

Yup, everywhere. Everybody. Owners scared to sell because they can’t buy again. Buyers feeling helpless and victimized. A sense money’s withering in the face of the housing bloat. Meanwhile frustration with politicians distracted by a virus which is ripping up the social fabric.

Jason and Alan pose the same query, from dramatically opposite situations: suck it up and buy, or gamble and wait?

There’s no right answer. But it seems like we’re getting a lot closer to catharsis.

First, mortgage rates are pushing higher, faster, especially after Friday’s killer jobs report showing the Canadian economy is reopening with vaccines and a vengeance. The five-year Canada bond surged over 1% – tripling where it was a few months ago. The bond market sees the Bank of Canada hiking rates at least three times in the next 24 months. “If market expectations are right,”says broker/blogger Rob McLister, “5-year fixed rates could have a 3-handle within 12-24 months. In other words, they should more than double from this year’s record lows.  Will those kinds of increases be a wet blanket for home price appreciation? It’s possible, if rates climb enough.”

Indeed. The bond market smells inflation. The cost of money has only one direction in which to travel. Remember the inverse relationship between houses and rates.

And what about pols? Justin & Chrystia? Or Dougie Ford and Comrade Horgan? Won’t they soon be triggered into action by a growing base of voters feeling forever shut out of home ownership?

Yup, seems inevitable. The wrong way would be to bring in a foreign buyers’ tax (they have little market impact) or incentives for newbie byers (which just push prices higher). Better solutions include a levy on speckers and flippers, higher downpayments for everyone (especially investors), graduated capital gains taxes on all residential properties and realtor reform to deal fairly with multiple offers, bully bids, blind auctions and market transparency.

The winds of change are gathering. Patience.

167 comments ↓

#1 Party on Garth on 03.15.21 at 2:01 pm

At the end of December, 2020 the total debt outstanding in Canada (bottom line of the Statistics Canada credit market summary data table) was $9.382 trillion. At the end of December, 2019 the total debt outstanding was $8.617 trillion. In the 1 year period from the end of December, 2019 to the end of December, 2020 it increased by $765 billion. This is an increase of 8.8%.

Update on the total (household, business, and all levels of government) debt numbers in Canada and the size of the Bank of Canada’s balance sheet

https://owecanada.blogspot.com/2021/03/update-on-total-household-business-and.html

#2 Billy Buoy on 03.15.21 at 2:05 pm

How about we return to a real market with actual price discovery?

Normal interest rates, less central bank intervention, real prices based on supply and demand. Yes REAL, TRUE prices.

“You may say I am dreaming, but I’m not the only one..”

Only when we Crash and many burn MAY we ever see it..

#3 Peter McLean on 03.15.21 at 2:06 pm

Is living in a tiny home, or a van parked down by Home Depot still the cool thing to do? I think I might sell all my possessions, and do that.

#4 Alberta Ed on 03.15.21 at 2:07 pm

Justin will do whatever he thinks will help him get re-elected, first, and what’s best for the country, last. Chrystia will fall in linebjust like the rest of the sycophants in his cabinet. In short, kick the can down the road.

#5 Millennial 1%er on 03.15.21 at 2:09 pm

You seem to have a lot more hope in our political system than it deserves. Hopefully something does change though.

#6 Ian on 03.15.21 at 2:16 pm

Love the photo. That’s wellington st west in Ottawa,ON. Poor dog has a 30% chance of staring into an empty storefront. They use to all be full 1km in either direction with small businesses. Yet the SFD up a block are all up 40%! YoY. GFLTA

#7 Jim on 03.15.21 at 2:17 pm

I don’t know how we are going to solve the supply problem. As of today builders have presold homes but will delay putting shovels in the ground due to high raw material costs. For example Lumber prices have tripled in the last year. A 2600 Sq/ft 2 story house used to require approx. 30k of lumber now you would be looking at 100K.

#8 Was once ... on 03.15.21 at 2:19 pm

in that dilemma myself. And what a sea change happened almost overnight. Can happen …

#9 cuke and tomato on 03.15.21 at 2:20 pm

We bought property 49 years ago one then two than three
and then four. The second one was a big purchase. People said we were crazy. We did not suffer we have seen everything in the world we wanted to see took our family to California Disneyland 5 times put three children through
real universities with a car. In our 16th year of retirement. Hope to do more once we get th vaccine.

#10 Dogman01 on 03.15.21 at 2:21 pm

We are becoming “a silly people”.

No wealth creation industry…just trading financial assets. Home building and immigration for growth.

Canada; we can’t get anything done. Byzantine gong show of stagnation and decline.
https://nationalpost.com/news/canada/from-vaccines-to-pipelines-to-clean-water-on-reserves-why-canada-cant-seem-to-get-anything-done

We don’t acknowledge this and do something about it:
“In sum, Canada has the same problem as many of our children: high self-esteem without high levels of achievement.”
https://financialpost.com/opinion/trudeaus-canada-low-achievement-high-self-esteem

China

We have reached the “tipping point” by giving away the store to a nasty totalitarian dictatorship in China.
“We will bury you” ; What the Soviet Union could not accomplish the Chinese simply did by appealing to the greed of the West’s established elite.
New Rule: Losing to China | Real Time with Bill Maher (HBO) https://www.youtube.com/watch?v=2DH4v6FnbvM

China has been positioning itself strategically with a decades long plan cultivating the wealthy in the West to hollow out our economy and ultimately our society. China’s strategy in Africa, recognizing that by 2050 Nigeria will have higher population than the USA, and that is where world economic growth will be.

#11 Sail Away on 03.15.21 at 2:22 pm

A tip for Jason: in a permeable mobile home, if you trap this mouse, you’ll have another two days later. Suggest you buy a ferret.

#12 S.Bby on 03.15.21 at 2:36 pm

There needs to be coordination between the government housing policies and the central bank. We need a sliding down payment scale where the lower or higher mortgage rates are, more or less of a down payment is required. A 5% down payment is just too little when interest rates are so low. We should be requiring 20%-25% down payments in this current environment.

#13 Doug t on 03.15.21 at 2:40 pm

The “winds of change” are going to come in the form of flatulence from our fearless leaders at budget time

#14 Catlady on 03.15.21 at 2:43 pm

Thanks Garth, hubby and I will be locking in the mortage for 10 years this Friday. We have tried to advise friends and family to do the same, but they think we’re crazy. Oh well, you can lead a horse to water…..

#15 Jenna on 03.15.21 at 2:48 pm

Flip flop…every day, week, month, year… holds some type of promise that the housing bubble will burst. When it’s on the verge the government (federal, provincial, municipal) and BOC step up and fan the flames of the housing market.
Who knows where the market is going ? Every indication is up and continues to go up. I am not or involved in the real estate market. I have been beyond patient, waiting in the bushes for a miracle. No miracle in sight ! Amen !

Market activity fell substantially in April of 2020, and in November condo prices in the GTA dropped 15-20%, as we pointed out. Did you act? – Garth

#16 Armpit on 03.15.21 at 2:55 pm

Friend resides in a updated Century Home – 1800 square feet – on 55 acres. Own his own water supply, and on septic. Property Taxes $3500. Land income from Farmer $5000. Added bonus – High Speed wireless Internet.

5 minute drive from edge of city boundary, local bus, and 25 minutes from downtown of major city where old houses on 25ft x 100 ft lots- needing major renovations – are now selling for $700,000 plus.

I asked if they know the value of their place. Friend was puzzled and asked why??? He’s not moving. He feels good here. Doesn’t lock up. Never had a theft, no Crack heads, Porch thieves, and Neighbour problems.

I then realized the value of his place….

Priceless

#17 binky barnes on 03.15.21 at 2:58 pm

Sometimes politicians get monikers hung on them by the media and/or the public-at-large. For example, former Ontario Premier Dalton McGuinty was dubbed ‘the Education Premier’ because he made that portfolio a focus during his tenure.

Soooooooo, I have been thinking about a moniker we could hang on our current PM. ‘Mr. Socks’ is lacking. Certainly a leader of Mr. Justin Trudeau’s stature should be characterized by something more fitting than his hosiery, should he not?

The Integrity PM? The Dancing PM? The Boxing PM? Just spit-ballin’ for now.

BB

#18 Alex on 03.15.21 at 2:59 pm

Garth – you keep saying that the foreign buyers tax did nothing yet in 2017 we clearly did see a downturn in prices. While not a silver bullet, I don’t understand why you advocate against it at least as part of a larger set of policies that could be used to temper house prices.

The BC Real Estate Association has concluded that offshore buyers had zero impact in the market during in 2020. Immigration collapsed and yet house prices surged uncontrollably. As this blog told you, we have done this to ourselves. There is no foreign influence feeding the market. – Garth

#19 Alex on 03.15.21 at 3:01 pm

I add this as evidence of my point above.https://www.theglobeandmail.com/news/national/toronto-housing-market-feels-effect-of-foreign-buyers-tax/article36258711/

Four-year-old story. Subsequently debunked. – Garth

#20 rknusa on 03.15.21 at 3:03 pm

re: Better solutions include a levy on speckers and flippers, higher downpayments for everyone (especially investors), graduated capital gains taxes on all residential properties and realtor reform to deal fairly with multiple offers, bully bids, blind auctions and market transparency.

a lot of good policy ideas here esp. higher down payments, spec levies and realtor reform

captial gains tax on homes maybe for flippers or maybe first 300K free and then taxed but Trudeau is 100% poltiical cannot be counted on to do the right thing

his response will likely be to increase shared equity program and a foreign buyers tax both which are politically safe

#21 wkg on 03.15.21 at 3:07 pm

The Jason post made me chuckle. The first house that I lived in when I left home was an old farmhouse in northern Alberta.
It had a serious mouse infestation, to the point where I just gave up, and decided to try and live with them. After a while I noticed sounds of something much larger than the mice in the house at night. I carried on, and noticed after a few weeks, there were no more mice.
Turns out, the other sound was a weasel, very symbiotic relationship, he took care of the mice, I left him alone.
I chuckle about it now, but obviously I did not come from wealth living in that situation. The lessons that I learned from that period in my life, I considered later to be a gift.

#22 Captain Uppa on 03.15.21 at 3:08 pm

DELETED

#23 Rook on 03.15.21 at 3:17 pm

#17 Soooooooo, I have been thinking about a moniker we could hang on our current PM.

———————————

Well, he is Canadian Royalty, and the Office of the PM is his by birthright. Let’s keep it simple: ‘The Dauphin.’

#24 Flop... on 03.15.21 at 3:19 pm

As I looked out the window of the house I was finishing up renovating, my heart skipped a beat as I saw a Global News vehicle pull up out front.

Hardcore Flopperites will remember back in the summer of 2018 Global News had come knocking on the front door of a 6-7 million new construction house I was just finishing up on and asked if anyone wanted to go on camera, mainly the questions were angled towards prices receding and what do we think was going to happen, did we have lots of projects coming down the pipe etc.

I let the development company do the speaking and kept quiet, no need to inflict harm on myself, I am paid to do manual labour, not talk, anyways.

Well back to the one I just finished, it was a back to the studs re-do on The North Shore.

The car pulled out shortly after and my blood pressure had been raised for nought.

I naturally thought the last time they came around it was an interesting time in Vancouver real estate, prices were coming down, which was a bit of a novelty, and sales below the 2.5 million mark seem to be going gangbusters.

I don’t like working on the North Shore, but we only got the recent one because we got a referral from a job I did last year, the extra travel time and elevation during winter make the day more exciting than it should be, but as a small business that’s what you want, so you try to keep the positive flow going as long as possible.

The one the got the reference was a 7-8 million brand new sub-penthouse

As I was doing the work, this thought kept coming into my head.

How many places in the world do people buy a piece of property for 7-8 million, brand new and then do a 500k major renovation before they move in?

So I’ve been on the North Shore since last October, I head back to my old stomping ground of the Westside of Vancouver later this week when I start a job on a house in Shaughnessy.

Hopefully get caught up on all the trade gossip, I only do probably ten houses a year max, if I get a couple of mansions then that fills my work calendar for the year, but you do ten, buddy does ten, a work colleague does ten, you end up with a decent information network and see what economic buttons are being pressed by the masses without asking too many questions, people just want to vent.

Things are fairly bubbly on my side of the rail tracks, but I will show you something that points to why this is still not anywhere near 2016 levels.

Let’s have a look at some data from the much maligned, but at least always available Zolo cartel.

https://www.zolo.ca/vancouver-real-estate/neighbourhoods

Let’s have a look at the hottest neighborhoods in Vancouver at the moment.

1) Grandview
2)Victoria
3)Hastings
4) Main
5 Hastings Sunrise

The thing to note is these are all on the more affordable Eastside.

My hood of Fraser comes in at number 7.

Let’s now have a look at stake the frosty side of the market.

1) Oakridge
2 Coal Harbour
3) Arbutus
4)University
5 South Granville

Reverse pattern at play here, all Westside except for the downtown Coal Harbour, where the higher-end condos hang out.

What else would we need to get lift-off from Cape Canaveral?

Traditionally you need some foreign buyers magic, real or imagined.

I saw a statistical note the other day that referenced that only 0.5% of Vancouver real estate sales last year involved foreigners.

Guys like me with two passports, who can’t decide which hemisphere to retire in, probably bought a little, but not enough to affect to overall natural flow of the market.

The big money, and the data and on the ground Intel would suggest the big money is still hiding in the shadows.

As documented on this very blog, before 2017, the owners couldn’t wait to get their properties on the market to cash in without having spent a night sleeping there.

Speculation is alive and well in Vancouver, but the trend the last few years is that a higher percentage of ownership is actually moving in after the construction is done.

As I alluded to earlier, the net is small, but with many fishermen in the water the net gets bigger, and the patterns more perceptible…

M46BC

#25 bobo on 03.15.21 at 3:19 pm

Firstly why cant the gov put a stop to blind auctions put on by realtors. How about a law that states you cannot advertise your house for a price you clearly will not accept. Realestate is the only industry not regulated, all the noise about house price gains when in reality it is mearly the average sale price of a group of selected sales durring a selected period of time they promote. How about giving buyers the access to common needed information on properties without having to beg your local realtorfor it. Informed buyers are realtors enemy

#26 Adriano on 03.15.21 at 3:27 pm

No more blind auctions. All offers should be publicly available. There should be a website where offers are made that shows all current offers on the property (can be otherwise anonymous). Currently, all we get to know is what the accepted offer was. And with real estate agents pressuring you to put in a bully offer at $80K over asking with no subjects, you’re taking them at their word that this is a logical thing to do. It’s achieves a Bayesian Nash equilibrium that only serves to benefit real estate agents and sellers.

#27 truefacts on 03.15.21 at 3:29 pm

Isn’t it supply and demand???

Reduce demand…

– Don’t allow non-resients to buy houses
– Reduce immigration levels drastically for a few years until enough houses can be built to meet demand
– tax capital gains on houses which decline gradually to zero if owned for 5-7 years (so only tax exmptions for long-term owners)

Increase supply…

– free up land to build on
– make building places easier (less red tape)
– target immigrants who have construction experience so we can grow the industry quickly
– allow mini coach homes or basement apartments more easily to expand accomodation quickly

I’m sure there are more – I don’t know a lot about building houses…

#28 Madcat on 03.15.21 at 3:31 pm

Finally a politician addressing the elephant in the room:

Pierre Poilievre

‘Cash creation by the Bank of Canada is pumping helium into financial/mortgage markets, inflating housing prices, to the benefit of millionaire mansion dwellers, at the expense of poorer renters & at great risk to the entire economy. #Debtonation’

#29 ogdoad on 03.15.21 at 3:33 pm

Love how ‘Richies’ like to visit this site and ask for confirmation from you, Garth. They already know what they’re going to do…but lawyers need a little spice in their lives.

Everyone who wants in will get in regardless of whether you (or anyone for that matter) offers objection. What pulls on my shorties is if every market across Canada inflates that is going to make my/our/everyone’s retirement more expensive.

How’s Manitoulin dong these days?

Og

#30 Dr V on 03.15.21 at 3:36 pm

9 cuke and tomatoes

“put three children through real universities with a
car.”

This could mean:

1) In order for a university to be “real “, it must have a car

2) That the universities you chose had such low entrance requirements they also enrolled and graduated cars.

3) one car was bright enough to obtain three degrees.

#31 Sail Away on 03.15.21 at 3:41 pm

#17 Soooooooo, I have been thinking about a moniker we could hang on our current PM.

———–

PM Clouseau?

#32 Brian Ripley on 03.15.21 at 3:42 pm

My chart of Vancouver Calgary Toronto Detached house prices valued in USD is published with FEB data:
http://www.chpc.biz/canadian-housing-in-usd.html

​In February 2021 a single family dwelling in the hot metros of Vancouver, Calgary and Toronto came in at 21% cheaper if purchased in USD as opposed to CAD.

​They were 28% cheaper in February 2016 and at the March 2009 Pit of Gloom, prices were 21% cheaper in USD.​

For all the people who are freaked out by housing prices in metro GTA, look at my comparison chart of Vancouver vs Toronto housing:
http://www.chpc.biz/compare-toronto–vancouver.html

In Toronto the absorption rate (Total Sales / Total Listings) is a fantastic 126%.
In Montreal it’s 141%
In Vancouver it’s 45%
Ssee http://www.chpc.biz/mar-moi.html

AND in Vancouver, the average priced SF detached is 36% or $493,000 more than in Toronto.

So yes, we’re all freaked out, but these absorption rates will not have a long half life… notice that in March 2017 (FOMO 1.0) the Toronto absorption rate hit an awesome 154% but 3 months later it had crashed and was plumbing the lows.

The fever will pass. One does not have to buy a house today. This market is for people with uninterrupted income. If your cash flow is unreliable so is your risk management.

#33 Freedom First on 03.15.21 at 3:47 pm

#14 Catlady

You and your Hubby just made a very very smart move!

Freedom First

#34 Linda on 03.15.21 at 3:48 pm

‘Alan’ & partner should seriously look at purchasing a serviced lot & then building new. A quick search brought up a couple of serviced lots for sale running between $839K to $899K. The $899K lot was roughly twice the size of the $839 lot; was located in what appears to be a rather upscale area that claims to be within an under 30 minute commute via vehicle to DT Toronto. Of course, the presumption is that Alan & partner want to go SFH. Shelling out $899K for a serviced lot is steep & then they’d have to get a home built. However they say 1.5 million is their cap, so they’d potentially have $600K to build with. There are one heck of a lot of possibilities here for a couple earning $500K per annum. Why buy someone else’s problems?

Alternatively, with the $ they earn they should easily be able to rent a much larger space than the one they occupy now. I’d never recommend purchasing a condo, so if they want DT living I’d say keep on renting but upgrade.

As for ‘Jason’, get or borrow a cat who is known to be a good ‘mouser’. If cats are out of the question for whatever reason, there are some dog breeds who were developed as ‘ratters’. Alberta may be rat free but mice free it isn’t, so a dog with those instincts would probably be willing to practice on smaller prey. Because there is no way you only have one mouse under your house:)

#35 CJohnC on 03.15.21 at 3:52 pm

2 things are needed to quell the insanity. Minimum 20% down and kill CMHC totally.

CMHC simply relieves the banks of risk and responsibility. It has outlived its usefulness.

I doubt the politicians have the balls to do either.

#36 meslippery on 03.15.21 at 4:01 pm

Jason build a barn on your farm put mobile home in barn.
No one will know you live there.

#37 KLNR on 03.15.21 at 4:02 pm

@#25 bobo on 03.15.21 at 3:19 pm
Firstly why cant the gov put a stop to blind auctions put on by realtors. How about a law that states you cannot advertise your house for a price you clearly will not accept.

i like what they do in Scotland.
you put your price out there and take bids.
If someone offers only asking you’re obligated to accept.
multiple offers all over asking you choose which one but you have to choose, there is no going back.
this gets rid of all the nonsense.

#38 IHCTD9 on 03.15.21 at 4:08 pm

I’m gonna guess Allan and hubby have zero plans to escape Toronto for the sticks. Probably not moving into certain GTA ethnoburbs either. In fact, there may only be a handful of areas desirable to a gay couple in the entire GTA, heck, the entire Province. Al and Hubs may not be open to 95% + of the Ontario RE market. Al did not bring this angle up.

If I’m out to lunch on this point, then my advice is gtfo out the gta, and find jobs in a smaller center – you may have to wait a few years for the latest boil-over to simmer down before exiting.

If I’m on-point, then I say use that big income to get what you want where you want as it becomes available, and provided it’s affordable to a 500K couple. You have much bigger issues if you have explicit restrictions on where you will live. Some great places within tight shopping confines may only come up for sale once or twice in a lifetime. Very limited choice means big competition.

#39 Trude on 03.15.21 at 4:08 pm

“Immigration collapsed and yet house prices surged uncontrollably” says Garth.

We added 182,000 in this extraordinarily “down year” and Trudeau is planning to add 400,000 more this year. The psychology can cause wobbles, but the only place that fundamental demand can come from for housing is people occupying the houses.

If you had zero influx, the price could surge temporarily but it could never increase permanently. This is not economics, this is just physical facts, which can only be ignored through intensely political mental conditioning.

There is not now, nor has there ever been, evidence Canadian real estate prices are determined by newcomers. We do this to ourselves, over and again. – Garth

#40 Darryl on 03.15.21 at 4:14 pm

Hey Garth;

I’ve been following your blog for awhile but not forever and so I don’t know if I’ve missed your thoughts on how real estate concerns like multiple offers and bully bids could be reformed, but I’d really like to hear about it.
I’ve been a homeowner in the GTA for the past 10 years and have purchased 3 times, each time having to participate in an offer night. I hated each time and thought for about how it could be handled differently, but never landed on anything practical.
Would you be able to share some thoughts on real estate reform?
Also, thanks for making this blog and the work you do. I really enjoy reading it everyday.

Sincerely;

Darryl

#41 Sara on 03.15.21 at 4:16 pm

If the trends we have been seeing continue, there are really only two options as to what happens next. Option 1 is unimaginable wealth inequality, where an individual’s success depends almost entirely on their parents and wealth is concentrated in a very small percentage of the population. Option 2 is an ever-growing bubble that through government intervention or economic collapse eventually pops and creates some opportunity for the have-nots. The bigger the bubble gets the bigger that pop will be, and the economic consequences of such a pop would likely hurt both the haves and the have-nots. Both of these options are devastating. The best way forward is price stability and reattaching home prices to income levels. Income growth rates are unlikely to see meaningful change, so the only way to prevent these from happening is to act quickly to curb the trends and bring real stability to home prices. This means no more 30%, 10% or even 5% annual growth. This means consistent monitoring of home price growth against income growth, on a national and regional level, where a target rate would be 1-3% based on historical income trends. The Bank of Canada’s mandate targets a 2% inflation rate but does not consider home prices and concerns have been raised regarding the methodology of accounting for shelter costs in the Consumer Price Index (CPI). The Bank of Canada implements measures to ensure their inflation target is achieved. CMHC, whose mandate is to make housing affordable for everyone in Canada, does not publicly set a target home price growth rate, nor does it have the tools to influence this on their own. There are a number of measures that policymakers could implement (some very quickly), including the introduction of home price growth targets, making data more accessible, applying stricter rules to investor buying, opening a national review of zoning laws that are causing supply issues, creating open bidding systems, reconsidering the term and magnitude of the quantitative easing program, and making certain offer conditions mandatory. While declining interest rates have driven up real estate prices, there are much broader implications of raising interest rates which likely make it an unrealistic solution. If this petition is successful in raising awareness and causing more policymakers to be vocal about the issue, the next step is to work on bringing immediate change before we are even further down the path of option 1 or option 2.

https://www.change.org/p/justin-trudeau-recognize-the-housing-affordability-crisis-in-canada?utm_source=share_petition&utm_medium=custom_url&recruited_by_id=00a14c50-82e3-11eb-a198-9f0aaef485b2

#42 Pricedoutmillenial on 03.15.21 at 4:25 pm

Bulls eye.. the last paragraph can be etched in stone.

Wish the policy makers read this and do the right thing else the Canadian dream will only be a dream for people who try to be prudent.

Greed is not good!

#43 Axehead on 03.15.21 at 4:27 pm

Where Jason lives in Alberta means everything. A quarter section of land can cost from 240k (in bum-scratch Peace River swampland country) to well over 800k (if number 2 soil) to millions (if near any major city). And if he has Bison, then he has expensive fencing for those Bison, and those Bison are worth a small fortune (think multiple thousands per head).

I don’t understand the illegal trailer part – if you own a quarter section in Alberta you can build or store anything you damn well please on it. Only subdividing (depending on the county) is restricted.

My guess is the guy is worth $1M+.

All this to say, he should have no problem buying a house. Alberta housing (except Calgary, recently) has trended lower and lower for the past 6 years since T1 waged war on Alberta O&G and former Premier Notley drove us into debt. Check out prices online in smaller cities like Red Deer and Lethbridge or even Edmonton or Stettler and you’ll be able to find a nice house for $300k or an acreage for around $500k (4 acers with services and a house).

#44 Rainman on 03.15.21 at 4:29 pm

Let’s hope the spring market is hot, we have listed and agree this is all unsustainable. I guess we are deemed greedy sellers?

#45 Don Guillermo on 03.15.21 at 4:30 pm

#31 Sail Away on 03.15.21 at 3:41 pm
#17 Soooooooo, I have been thinking about a moniker we could hang on our current PM.

———–

PM Clouseau?
************************************
PM NoClueso? even better

#46 Dolce Vita on 03.15.21 at 4:32 pm

Low rate environment.

25% down for CMHC insurance. 10% minimum downpayment.

Speculator tax and the other good ideas you wrote about at the end Garth.

———————-
Robert Kelly, who chaired the CMHC between 2013 to 2018​

[CAUTION & Abandon all Hope upon entry: Garth’s least favorite business site]:

https://www.bnnbloomberg.ca/canadians-need-to-mind-dangers-of-debt-former-cmhc-chair-1.1577327

Sounded like Garth near verbatim including teaching Cdns. about debt and financing (focus on the debt not just the payments). He probably reads this Blog from the sounds of it.

Advocated higher downpayments as well. Female interviewer at the end a ditz putting words in his mouth.

——————-

Also, as long as CMHC shoulders the burden of any default the Banks will continue to print money for mortgages as they have no skin in the game at the end of the day.

Somehow, they have to shoulder the burden. Higher downpayments for sure and lower debt load %’s, lower yet for investors.

Change the goalposts on the Banks so to speak.

#47 Father’s Daughter on 03.15.21 at 4:33 pm

$1300 for a $500K household?
Upgrade to a rental 3x the price.
Can rent a house or a way nicer condo
Paint, add new light fixtures, balcony garden, make it your own
You’ll be living the dream
Buying a $1.5M semi here is depressing and not worth it

#48 YVR Renter on 03.15.21 at 4:50 pm

#25 Bibo- with ya on this. Why is it price gouging when Lysol wipes are jacked up, but not when realtors play games?

#49 Luca on 03.15.21 at 4:53 pm

Garth, this blog day in and day out spanks the housing market and those who buy calling it a mistake as higher rates (or in the past other reasons) will cause a crash whether small, medium or large. But when the crash is questioned you advise you aren’t predicting a crash. Then why all the doom and gloom for real estate? What’s the mistake people are making I don’t get it??

No crash. But with Herculean debt, constrained incomes, too much net worth in one asset and scant liquid wealth, all it takes is a flatlining market or rising rates to cause a lot people a ton of hurt. How is that not obvious? – Garth

#50 CJB on 03.15.21 at 4:53 pm

Are there like average income people in Toronto like teachers, mechanics, mailmen, accountants…and if so where in the heck do they live? For example a family of four with income of $120,000 a year. Are they homeless?

#51 Dogman01 on 03.15.21 at 4:55 pm

#17 Soooooooo, I have been thinking about a moniker we could hang on our current PM.

————————

Little Lord Fauntleroy

“A person who is spoiled, conceited, and characterized by a pompous air of decadence, intellectualism, and moral superiority.”

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

#52 Legal beagle on 03.15.21 at 4:55 pm

Tell the lawyer(s) that I will provide them with a whiff of my dark, dank and musty garage on my multi-million dollar Scarborough wartime house. Of course, in exchange for a full day’s worth of his legal services!

#53 Dolce Vita on 03.15.21 at 4:56 pm

Canada Variant World

That darned UK variant just does not give up easy (almost all the Cdn variant cases). Still no ICU/hospital beds filling up. Not exponential either – not even close (trend line in chart is a 3rd order Polynomial).

But get this, the past 3 weeks to Mar 13, cumulative variant cases:

+311%
A 4X increase
800 to 3019

https://i.imgur.com/tL1RtAG.png

——————

Most of Italia, save a few Regions, in Zona Rossa – a strict lockdown (Ides of March 2021) and about 70% of the new cases are the UK variant.

Hopefully Italia has learned from the UK experience. In Mario Draghi we trust.

Italian youth has not lost their sense of humour though. If you’re on TikTok, Domenico’s take on youth travel nowadays in Italia pretty funny, enable sound for effect (Vacanze di Pasqua = Easter Vacation) – you just want to break down and cry for the poor things:

https://www.tiktok.com/@domenicorusso02/video/6939231265174441222?lang=en&is_copy_url=1&is_from_webapp=v1

#54 Jack on 03.15.21 at 4:56 pm

There is not now, nor has there ever been, evidence Canadian real estate prices are determined by newcomers. We do this to ourselves, over and again. – Garth

So you want to say that all this time the people who came to Canada never bought houses?
Of course it’s driven by immigration. I am an immigrant that didn’t buy a house yet, but all my immigrant friends, all of them, bought houses already.
Of course that the ones who arrived 1 year ago will not have the money to buy anything. But the ones who arrived here 5 years ago, now have enought for a downpayment and a good credit score. So yes, immigration rises the housing prices.

People who come to live here, work and amass a down payment over time are called ‘Canadians.’ – Garth

#55 Stone on 03.15.21 at 4:57 pm

This is for Alan. So you want to take on a $1.2 million mortgage. At 2.25% mortgage rate for 5 years with a 30 year amortization, P&I comes to about $4600. Add on municipal taxes and the payment overall goes north of $5,000/month. Why not just rent a house at $5,000-$5500/month? Keep your $600k invested in a balanced and diversified portfolio and keep on adding the $180k a year as you’re currently doing it. Stay flexible and mobile.

https://www.realtor.ca/real-estate/22869894/17-keewatin-ave-toronto-mount-pleasant-east

https://www.realtor.ca/real-estate/22835600/16-cuthbert-cres-toronto-mount-pleasant-west

I wouldn’t recommend it unless I do as I say. Renting is great and my B&D grows, grows, and grows. The more time my money is in the market, the more it grows. Just like today. My B&D is 8.59% YTD.

Why are you all stressing so much unnecessarily?

#56 WTF on 03.15.21 at 4:58 pm

#17 the binkster

I propose: dilettante
noun [ C ]

a person who is or seems to be interested in a subject, but whose understanding of it is not very deep or serious
———————————————————-

Biden in the WH highlights a stark contrast between someone competently leading and managing several hot button issues VS non sensical prattling “word salad” from our PM.

Watching Poilievre slice and dice him in the house last week while the PM’s response was read from a binder of talking points (presumably created by the PMO or Butts.) Is telling, not too quick on the uptake.

https://thepostmillennial.com/watch-trudeau-says-poilievre-is-one-of-many-canadians-who-lost-their-jobs-during-the-pandemic.

Canada is screwed with this Liberal Party iteration of “leaders”

PS: Lot of apartments for Rent in DT Van these days, more than I have seen in years.

#57 earthboundmisfit on 03.15.21 at 5:03 pm

@17 binky barnes

I’d suggest “Prevaricating Dimwit”.

#58 False impression on 03.15.21 at 5:04 pm

Garth Canada has had some of the most relaxed and irresponsible mortgage lending standards in the world for decades. These lax lending standards are what caused Canada’s housing bubble that you wrote about in 2008.

These irresponsible lending policies were not a new thing in 2020.

#59 Guelph Guru on 03.15.21 at 5:12 pm

More intervention options for Mr. Trudeau to consider:
1. Stop QE. Govt and Corp bonds to be sold on open market. As a tax payer, I do not want to be forced to invest in these bonds anymore.
2. List CMHC as a publicly traded insurance co. without tax payer backing. Let’s see who invests in the IPO.

#60 We live in interesting times on 03.15.21 at 5:13 pm

Let me know if you’ve heard this before …

You know things are f’d when my neighbor, who had a perfectly good part-time job, decided to quit her job last year during the pandemic, collect CERB and swing trade with this new found money. This is now their only source of income since they have decided not to open their B&B this tourist season because, well, you know, its just too much work and takes away from things they would rather be doing. Her husband was the one doing most of the work in the B&B (while she went off to her job) but now is not working anywhere since he has limited English language capability.

Did I mention they are in the process of purchasing a condo?

It will be interesting to see how this unfolds over the coming months and years. I wish them well.

_______________________________________

Other people we know invested heavily in Bitcoin last year. Their hope was that housing prices were going to topple after the run-up last summer and that they would be able to purchase a home here in the nicest city in Canada . While I expect they have done extremely well with Bitcoin , this might not be enough to offset the increased housing price.

#61 Dolce Vita on 03.15.21 at 5:17 pm

One last salvo on Italia not having lost her sense of humour with most of her in Zona Rossa.

Garth, THIS is for your Italian speaking Blog readers [a.k.a., 1/2 of Toronto, Hastings Street & Bosa environs, etc.).

Again, for TikTok users (having travelled those Regions I near split a gut watching it, over and over again) – Sardegna Zone Bianca envy – again, turn sound on:

https://www.tiktok.com/@giomi82/video/6939070836292717829?lang=en&is_copy_url=1&is_from_webapp=v1

– If you post it, thanks Garth.

#62 Paul on 03.15.21 at 5:17 pm

#40 Darryl on 03.15.21 at 4:14 pm
Hey Garth;

I’ve been following your blog for awhile but not forever and so I don’t know if I’ve missed your thoughts on how real estate concerns like multiple offers and bully bids could be reformed, but I’d really like to hear about it.
I’ve been a homeowner in the GTA for the past 10 years and have purchased 3 times, each time having to participate in an offer night. I hated each time and thought for about how it could be handled differently, but never landed on anything practical.
Would you be able to share some thoughts on real estate reform?
Also, thanks for making this blog and the work you do. I really enjoy reading it everyday.

Sincerely;

Darryl
————————————————————————————————
I’ve seen the enemy it is you the seller.wanting to get the highest and best offer for their house then complain
How that is accomplished. You can fix it next time you sell list with no hold back and take the first offer.

#63 Build a better mousetrap on 03.15.21 at 5:19 pm

“I’m laying under my trailer right now trying to find the mouse that keeps me awake at night and it’s here that I find myself reaching out to you. We can live here for another year but then we have to either build a house on land that I own or move the mobile on said land or buy something. I guess we could rent but not much comes up for rent close by and is usually too much money. We farm so we need to be somewhat close.

………

“My cash is losing value from Trudeau printing more everyday, the stock market is a bubble. What do I do?”

________________________________________________

Build a better mousetrap. This will provide you and your family with untold wealth!
Besides, how hard can it be? People have been doing this since the dawn of, well, mice.

#64 Ponzius Pilatus on 03.15.21 at 5:22 pm

No more Chinese crap for me, unless it’s a hammer, dinner plate, coat hanger etc… Every time I’ve paid the premium for top quality, I’ve never regretted it.
———–
Amen.
Price is what you pay.
Value is what you get.

#65 Concerned Citizen on 03.15.21 at 5:29 pm

It’s not just real estate where we’re seeing froth either. The U.S. stock market looks especially bubbletastic. Spend a few minutes clicking through multpl.com and you probably won’t like what you see. P/E, P/B, P/S ratios are all through the roof (and P/B and P/S won’t be nearly so quick to recover as P/E). Yet, the markets go higher seemingly every single day.

Ordinarily I’d say this has a very good chance of being a lost decade for U.S. stocks. We’ve had these periods before right after huge bubbles burst, such as after the Dot Com Bubble bust. But now with endless central bank life support, I really have no idea. Maybe it really is different this time. Maybe the fundamentals investors of yester-year have spilled so much ink over are now irrelevant.

I’m not liking the setup – prospect of higher taxes (including on capital gains and big corporates), nosebleed valuations, possibly higher interest rates going forward, low economic growth for the foreseeable future (after the recovery bump), etc. All my finance/economics book learning is telling me to run for the hills. But central banks seem to be engaged in a giant book-burning fest and continue to repel gravity.

#66 KLNR on 03.15.21 at 5:30 pm

@#29 ogdoad on 03.15.21 at 3:33 pm

How’s Manitoulin dong these days?

I know theres a local that posts on here.
maybe he’ll tell you lol.

#67 Alex on 03.15.21 at 5:31 pm

Lol come on Garth – you say :The BC Real Estate Association has concluded that offshore buyers had zero impact in the market during in 2020. Immigration collapsed and yet house prices surged uncontrollably. As this blog told you, we have done this to ourselves. There is no foreign influence feeding the market. – Garth

So prices just dipped for no reason as soon as they introduced the tax? Come on.

Foreign buyers in 2020 = 0.46% of sales. Locals = 99.53% of sales. And the market boomed. We did this to ourselves. – Garth

#68 under the radar on 03.15.21 at 5:32 pm

#16 My farm is 50 acres with a big house , forest and pond 90 minutes from central Toronto. I know the feeling when you talk about priceless. I got way more than I deserved when i bought this.

#69 Rainman on 03.15.21 at 5:33 pm

People who come to live here, work and amass a down payment over time are called ‘Canadians.’ – Garth

A good play on words, but at the end of the day the fact that more people are here creates more demand. So yes immigration drives housing to a certain degree. Supply and demand concept…

#70 Cheese on 03.15.21 at 5:33 pm

You could be making 30k, and not being able to even rent, its a trip, trust me.

#71 False impression on 03.15.21 at 5:36 pm

#35 CJohnC

CMHC is a huge part of the reason Canada has had a bubble as long as it has. In 2009 Garth called CMHC Canada’s economic recovery plan or something very close to that. And CMHC’s numbers in the immediate years leading up to that time and since that time certainly back his observation.

CMHC was created in 1946 and for the first several decades its use could arguably be described as responsible when compared to how it has been used in recent decades (along with Canada’s private mortgage insurers).

Scaling its use back to what it was originally would be a huge step toward bringing back more responsible lending standards.

Also for the longest time in Canada the minimum down payment was 25% (if I’m correct without looking it up).

Until around the year 2000, young Canadian families could buy a detached house for around 3 to 4 times the average household income.

All of that was ruined when housing bubble policy was implemented as a (destructive) measure to stimulate the failing economy that had just gone through the dotcom bust. Garth has written about this.

It won’t take intervention to bring about the inevitable for Canada. A catastrophic housing price correction awaits. Boom-bust deniers will be proven wrong… again.

#72 Alex on 03.15.21 at 5:42 pm

Hey guys quick tax question, Is Digital News Subscription Tax worth worth claiming? Do they check to see or is it safe to just claim?

#73 Ponzius Pilatus on 03.15.21 at 5:44 pm

Sail on, sail on, Sailo.

Here’s a quick analysis for 30-person well-managed professional office:

Office monthly rent plus overhead specifically for the building: $20,000
Office monthly salary: $140,000
Office monthly revenue: $350,000
 —————–
I’ll assume for a moment that you actually own and run a  “well managed professional engineering firm”
I’ve run the number thru my abacus, and it looks like the salaries you quote are in line with what engineers in Venenzuela would be paid.
In any case, it probably explains that all the bridges that you design are crooked.
Any engineers here, that want to comment?
You’ll get a Sailo autographed Hawaiian Whale T-shirt for your efforts.

#74 Cow Man on 03.15.21 at 5:49 pm

Sir Garth:

You stand to be corrected about foreign investment having an impact on real estate prices. In you former Federal Riding of Halton, significant blocks of farm land in the Green Belt, Niagara Escarpment Controlled Area, south of 401 and from Bell School Line, east, west to Milbourgh Town Line are being accumulated at 10 times the price per acre of 10 years ago. Each property is being purchased as individual numbered companies. All the money appears to be from off shore. If you want proof, contact me. You have my email address. No one pays $100,000 an acre plus HST, to farm in the Region of Halton. Does any level of Government care if Canada is being used to launder money ?

#75 Rogerhomeinspector on 03.15.21 at 5:49 pm

I think the fair thing to do is to tax capital gains on a decreasing scale (longer you own less tax you pay) on principal residences, minimum 20 percent down and get rid of CMHC. Get back to basics.

Most important I feel is the CMHC- there’s no risk to the lender to hand out gobs of money. I bet at least 1/3 of all buyers would be instantly disqualified by lenders today if the government wasn’t backing the deal.

As an example- we purchased a new car last March. My spouse is an RN at the local hospital so she surely wasn’t loosing her job and I’m in trades so declared essential by some messed up metric. Anyhow, with rates at rock bottom we figured we’d look at financing options. My credit score at that time was 811 and hers would be similar. It was like nailing jello to a wall trying to get someone to lend as it was seen as a risky loan… even though we could document the fact that we had enough cash siting in our chequing account to cover the amount?! We decided to stop being insulted and bought cash but I assure you that deal would have whistled through if the federal government was backing it.

I think it’s time again to have people actually work for and earn the things they want. Owning a home is a privilege, not a right.

#76 Mike from Canmore on 03.15.21 at 5:51 pm

#17 binky barnes on 03.15.21 at 2:58 pm
Soooooooo, I have been thinking about a moniker we could hang on our current PM

#########

How about we go with

The Feckless Freeloader

or longer title

The Feckless Freeloader in Ottawa

it seems to fit.

#77 Ponzius Pilatus on 03.15.21 at 5:59 pm

#28 Madcat on 03.15.21 at 3:31 pm
Finally a politician addressing the elephant in the room:

Pierre Poilievre

‘Cash creation by the Bank of Canada is pumping helium into financial/mortgage markets, inflating housing prices, to the benefit of millionaire mansion dwellers, at the expense of poorer renters & at great risk to the entire economy. #Debtonation’
——————
He sounds more like a socialist than a conservative.
That’s the problem with the cons.
They can’t decide what they wanna be when they grow up.
That guy should cross to floor.
He’d be quaranteed to move up quickly.

Y

#78 willworkforpickles on 03.15.21 at 5:59 pm

The socialist US dollar will decline in value at a precipitous rate through continued rampant debt creation.
The ultimate price to pay for creating more debt with zero intent to pay back its debtors will be the removal of nearly all who live and reside in the US.
Removal by force by death or a forced physical re-location.
The unlucky ones who survive will face the worst suffering.
All relatively soon late 20’s early 30’s.
The future is not ours to see.

Just looking ahead some…but don’t worry none…its all good for now………until it isn’t.

#79 Nelson on 03.15.21 at 6:04 pm

Alan: 500K combined annual household income and torn up over the decision to purchase a 1.5M$ home…..3X income. Hmmm, I’d say it’s affordable, regardless of future interest rates or government policy. Cry me a river. Many families in major canadian markets have to agonize over the decision to commit to 10X household income to get into the market.

As for Jason, weathering the prairie north winds in a trailer in the middle of nowhere AB, why the hesitancy over the last few years? AB has been affordable for a long time – were you waiting for houses to be free?

‘Axehead’ states that he estimates Jason’s net worth to be 1 Million plus…..because he owns a quarter section in AB and some bison. Hmm. I own a quarter section in eastern AB with a 2500 sq. ft 90s build house on it that I would be lucky to get 350K for the whole lot. I also used to raise livestock for a living. You’re out to lunch on your price estimates. Huge variation in land prices in AB to be sure – but assuming a guy is a millionaire because they have a quarter with a few head of bison….come on.

I live between Courtenay and Campbell River on Vancouver Island on a half acre lot….which is worth at least twice what the old homestead in AB is. That’s the world we live in….but I get it, tulips are growing there and the grass is asking to be cut and here in AB (back to do some spring maintenance) it’s snow, mud, ice and brown/grey as far as the eye can see…Oh yeah, and Kenney is premier….spending taxpayer dollars to attack children’s cartoons for their ‘energy industry bias’.

Now…we are all wanting government intervention in the housing market? Yeesh! What happened to fiscal conservatism?

Governments and central banks have been practically subsidizing financial markets for decades. Stocks keep setting records regardless of what happens in the real economy. Not a lot of complaining going on about that in this blog or in it’s comments section. Yet the combination of low interest rates, the principal residence exemption, and Canadians peculiar residential R.E. obsession leads to inflated housing prices and everyone is fit to be tied.

Let it ride.

#80 Rick Danger on 03.15.21 at 6:13 pm

#54 Jack
So you want to say that all this time the people who came to Canada never bought houses?
Of course it’s driven by immigration. I am an immigrant that didn’t buy a house yet, but all my immigrant friends, all of them, bought houses already.
Of course that the ones who arrived 1 year ago will not have the money to buy anything. But the ones who arrived here 5 years ago, now have enought for a downpayment and a good credit score. So yes, immigration rises the housing prices.

People who come to live here, work and amass a down payment over time are called ‘Canadians.’ – Garth
____________________________________________

Top response of the day!

#81 Nelson on 03.15.21 at 6:14 pm

Jason….just to chime in on your mouse problem…I’ve got a big (massive really) grey Tomcat that found his way here to this old farm and my mouse problems ceased to be.

We’ve named him Phil the Prairie Panther, and he won’t even eat the cat food we try to feed him….if it ain’t breathing and doesn’t bleed, he’s not interested.

Anyway, if you want him he’s yours but you’ve gotta come wrangle him yourself. I wouldn’t dare.

#82 Winner? on 03.15.21 at 6:14 pm

This filed as a 74 year old in the process of selling a central Toronto family home, part of a group not mentioned much in this blog, beyond implications we undeserved profiteers. I stand to receive many Canadian pesos now, when I don’t need them. Sorry, I don’t plan everything.

The backstory is the story: In 1984 I stuck out my financial neck to buy an interesting central city place beyond my means, hoping some rental income from part of it would balance the books. It did…sorta. With debt costs what they were, for a long period, our family -a ‘big’ one by Toronto measures, was house-poor. Despite a good reliable income on my own part, frugality by my family, we paid a high price for living in the City I worked for, and satisfy our own long traditions of urban people who liked affinity with other urban people, family, friends or colleagues.

To this day wonder whether the debt trap that ensued for a long time was worth it. It distorted our household finances and opportunities for a long time. The current RE hysteria in Toronto, or the proceeds of this sale, which will be given to my kids so they can perhaps afford to do something, somewhere, is kinda a zero-sum game.

The last option apparent for individuals concerned about today’s RE circumstances is to not play the game. If I had a better idea would share it.

In an uncertain world, debt obligations are certain. You bin warned. Or…to sketch the big picture, think of central Toronto now as a gated community. You may or may not have the price of admission, but we all know what it is.

#83 Wait There on 03.15.21 at 6:17 pm

Did the head of the Bank of Canada that there was NO HOUSING BUBBLE? Then we have the head of RBC warning about lofty prices at the same time competing by offering super low mortgage rates.
And yeah, how much more productive investement resulted from the low interest rates…which it was supposed to induce.
Now we expect leaders to correct what they themselves created? Kick the can and hard!

#84 whiplash on 03.15.21 at 6:17 pm

#17 binky barnes

How about “a full blown ignoramus masking as an intellectual prodigy”.

#85 Stone on 03.15.21 at 6:23 pm

#53 Dolce Vita on 03.15.21 at 4:56 pm
Canada Variant World

That darned UK variant just does not give up easy (almost all the Cdn variant cases). Still no ICU/hospital beds filling up. Not exponential either – not even close (trend line in chart is a 3rd order Polynomial).

But get this, the past 3 weeks to Mar 13, cumulative variant cases:

+311%
A 4X increase
800 to 3019

https://i.imgur.com/tL1RtAG.png

——————

Most of Italia, save a few Regions, in Zona Rossa – a strict lockdown (Ides of March 2021) and about 70% of the new cases are the UK variant.

Hopefully Italia has learned from the UK experience. In Mario Draghi we trust.

Italian youth has not lost their sense of humour though. If you’re on TikTok, Domenico’s take on youth travel nowadays in Italia pretty funny, enable sound for effect (Vacanze di Pasqua = Easter Vacation) – you just want to break down and cry for the poor things:

https://www.tiktok.com/@domenicorusso02/video/6939231265174441222?lang=en&is_copy_url=1&is_from_webapp=v1

———

That was a really good tiktok.

#86 gfd on 03.15.21 at 6:24 pm

Just received this one from a GTA realtor (Durham).

“THE HOUSING MARKET IS SHIFTING!…hey guys, welcome to my March newsletter. While the numbers for the market will be mentioned in my 5-minute market update video below, I think it’s important to mention the fact that the video was done a few days ago (still correct – interestingly) and the market has shifted, and is shifting. As per my earlier predictions, things have slightly slowed down as we have now gotten to that number of 10,000 active listings in inventory. I’m noticing not as many offers on properties, with some being relisted at higher prices and no offer dates. So, while it still is definitely a sellers’ market (super-sellers’ market to be more accurate), it’s not the same as before. I’ve seen many listings start out with offer dates, not get what they want on those dates, and get relisted at a higher (see – realistic/accurate) price. That said, inventory is still not where it should be . . . . . .”

Patience may very well be the key!

#87 Habitt on 03.15.21 at 6:26 pm

So what happens to the regular joes and janes making well you know. I suspect it’s let them eat cake. Lol

#88 Capt. Serious on 03.15.21 at 6:39 pm

I would love to see reasonable down payment requirements. It’s not unreasonable to ask for 20% down from a buyer if the rate of interest is effectively inflation.

#89 Rinse and Repeat on 03.15.21 at 6:47 pm

Patience? Is this the bi-annual glimmer of hope offered through rising interest rates, an economic recession, or interventionist government policy?

Since the birth of the real estate bubble, can you please name ONE federal or provincial policy that had ANY impact?

Or one implemented that was designed to curb demand, such as a tax, without the implementation of another at the same time to increase demand, like 1st time buyer incentives and equity mortgages?

Crickets…. because every initiative has failed – whether it’s increased down payments, reduced amortization periods, speculator and foreign buyers taxes, reduced equity withdrawals, and reduced CMHC thresholds.

There is absolutely nothing going for Canada economically when 25% of your GDP is tied to buying and selling houses to each other. In the midst of a pandemic, there is only sector generating any ‘wealth effect’ that will drive a recovery – and its housing. And no government – either the feds or the provinces – will do anything about it after their own finances have been decimated.

Having lived through the ‘great hope’ for a correction of 2017 during the last boom of the bubble, this is how it will go.

1. The feds will announce a policy to take effect 6 months or a year from now, giving plenty of time for buyers to push prices up.

2. The initiative will be heralded as a groundbreaking initiative generating hope for those that want to buy, only the details show that there will be minimal impact.

3. The market will have a month or two pause before its upward trajectory, as the mindset for every Canadian is that real estate is the only path to financial independence. The fact that it has worked for the 70% of the population for the last several decades reinforces it.

The horse left the barn a decade ago, and there is no going back. The elimination of the middle class is something that does not even register in the minds of the decision makers. After all, that class if replenished every year with 100,000s of individuals from around the world willing to make Canada their home.

#90 david prokop on 03.15.21 at 6:48 pm

The rental market is also insanely expensive.
Makes me wonder why would so many immigrants want to come here? Most will be making minimum wage for start and will never own a place

#91 Sail Away on 03.15.21 at 7:08 pm

#73 Ponzius Pilatus on 03.15.21 at 5:44 pm
Sail on, sail on, Sailo.

Here’s a quick analysis for 30-person well-managed professional office:

Office monthly rent plus overhead specifically for the building: $20,000
Office monthly salary: $140,000
Office monthly revenue: $350,000

———-

I’ll assume for a moment that you actually own and run a “well managed professional engineering firm”
I’ve run the number thru my abacus, and it looks like the salaries you quote are in line with what engineers in Venenzuela would be paid.

———-

Good eye. I wondered if anyone would notice. That’s actually the biweekly salary number.

So, thanks for the chance to correct. Monthly salary: $280k.

#92 Phil on 03.15.21 at 7:14 pm

The application of CMHC’s mandate has changed greatly since it’s inception.

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

#93 crowdedelevatorfartz on 03.15.21 at 7:21 pm

@#77 Ponzie’s Political Poilievre Pirouette

“That guy should cross to floor.
He’d be quaranteed to move up quickly.”

++++

Trudeau couldnt handle a guy named Pierre replacing him.

#94 Nonplused on 03.15.21 at 7:42 pm

“Better solutions include a levy on speckers and flippers, higher downpayments for everyone (especially investors), graduated capital gains taxes on all residential properties and realtor reform to deal fairly with multiple offers, bully bids, blind auctions and market transparency.”

I have in these comments been very much opposed to capital gains taxes on primary residences because they could lock people into their existing home when all the want to do is move, thus exchanging one expensive house for another, but not really ending up any further ahead. However, a “graduated capital gains tax”, if designed correctly, could help avoid this problem.

A few days ago I proposed $0-$250,000 – 0% inclusion, $250,000-$500,000 – 25% inclusion, and $500,000+ – 50% inclusion. Sort of like how income taxes work. Something like that might work. It is still not perfect though, most people finding themselves with a $500,000 capital gain would be including $62,500 in their taxable income in year they sell, most of which would be in the top tax bracket even though their annual income is in many cases lower. It would result in a tax hit of $31,250, which for most people would be a tough pill to swallow, especially if they are just planning on buying a similar house because they need to move. In most cases this sum would have to be added to the mortgage.

Also in the case of cohabitating or married couples, do you split the gain for income reporting? Or can you assign the gain to the lower income partner who may not even be working? And of course retired people aren’t going to be withdrawing from their RRSP’s the year they sell for good or perhaps the next several, so there is that. Tax management 101.

Of course this problem would only apply to people living near YVR or YYZ. Prices near YYC don’t really go up, and haven’t since 2007 (maybe 10% in those 14 long years). From Brian: http://www.chpc.biz/6-canadian-metros.html

———————————

A far better approach is probably to get real “on the street” inflation back down to 2%. This means raising interest rates. If house prices inflate at 2% you don’t have to worry about a capital gains tax because after inflation there really isn’t any gain. A house become just a house, not a notional money printing machine or ATM.

————————————-

And the funny thing about it is that by raising rates, the government would probably collect just as much tax from the bond market as they would from a capital gains tax on primary residences. If rates normalized at say 4-5%, suddenly a lot of bond holders will actually have some income to declare! No more of this 0.1% GIC business. Once again proving, of course, that we are already at peak tax. All they can do at this point is move the point of collection around. Raise the carbon tax? Less business taxes. Raising the minimum wage causes more people to pay taxes but it also reduces business profit and thus taxes. There are only so many dollars out there no matter how many they print. When you hover them up in one area, they disappear from somewhere else.

——————————–

We all kind of sense that if rates went up to say 4% then the interest on the government debt would become unmanageable. But I wonder if this is indeed so? How much more tax would be collected from the entire lending/bond markets, which far outstrip the nation debt in magnitude? Granny isn’t paying much tax on her 100% government bond portfolio now, but at 4% she’ll be paying something. And she might be able to afford groceries. No more kibbles and gravy! Tonight we are having Hamburger Helper!

—————————————

“In the future, you will own nothing and you will be happy.” – NWO

The combination of zero rates, inflation, and taxes is how the NWO means to accomplish this without a violent revolution. The “you will be happy” part is more of a command than a natural outcome, I think. Sort of like when your mom used to say “you will eat your brussels sprouts and you will like them!”

#95 Nonplused on 03.15.21 at 7:53 pm

#11 Sail Away on 03.15.21 at 2:22 pm
A tip for Jason: in a permeable mobile home, if you trap this mouse, you’ll have another two days later. Suggest you buy a ferret.

———————————-

Cat. Put Felix on the job. That is good advice for anyone who lives semi-rural as the little buggers will find a way into your house too. And of course you also need a dog to protect Felix from the coyotes.

#96 Dr V on 03.15.21 at 7:54 pm

79 Nelson – tonights low will still be about 0. Will probably cut grass tomorrow as Wednesday will be a
bit warmer giving the green monster one good sunny
day to grow before the rain comes Thursday.

Love seeing the snowpack on the mountains in the distance behind the pasture land on my bike rides. The
slight N’easter kept the air cool but the sun felt warm.

Snowed on the north island yesterday.

https://www.theweathernetwork.com/ca/weather/british-columbia/black-creek

#97 Tyberius on 03.15.21 at 7:57 pm

#16 Armpit on 03.15.21 at 2:55 pm

Friend resides in a updated Century Home – 1800 square feet – on 55 acres. Own his own water supply, and on septic. Property Taxes $3500. Land income from Farmer $5000. Added bonus – High Speed wireless Internet.

5 minute drive from edge of city boundary, local bus, and 25 minutes from downtown of major city where old houses on 25ft x 100 ft lots- needing major renovations – are now selling for $700,000 plus.

I asked if they know the value of their place. Friend was puzzled and asked why??? He’s not moving. He feels good here. Doesn’t lock up. Never had a theft, no Crack heads, Porch thieves, and Neighbour problems.

I then realized the value of his place….

Priceless
+++++++++++++++++++++++++

“Price is what you pay; value is what you get.” – Warren Buffet (I think)

#98 Axehead on 03.15.21 at 8:13 pm

#79 Nelson,

My point exactly, eastern Alberta is pretty much Saskatchewan. Cheap land. It all depends on location.

#99 Nonplused on 03.15.21 at 8:19 pm

#25 bobo on 03.15.21 at 3:19 pm
Firstly why cant the gov put a stop to blind auctions put on by realtors. How about a law that states you cannot advertise your house for a price you clearly will not accept.

——————————-

That is a good point. In almost all other markets the first person to show up with the asking price gets the item. Even if you are selling a used dirt bike on Kijiji it is considered bad form to sell it to anyone else but the first person to show up with the ask price in cash.

It even holds in markets. If you are say selling NYMEX natgas contract, if you say you will sell at $3 and somebody shows up you get filled. You don’t get a do-over at a higher price. If it is Texas and the bid is $300 the next day, too bad for you unless you have more to sell.

Unfortunately the housing market resembles more of an auction, where the list price is more of a reserved bid.

Perhaps a law that stated that a house cannot be sold for over ask and cannot be withheld from the first buyer to pay ask and prove financing would help. Certainly that would mean sellers would list higher, expecting to have to “negotiate”, but it would also stop people who won’t really have a shot at it from looking like a lineup outside a condo open, increasing hype.

—————————–

Have you ever been to an auction before? They are kind of fun, but you won’t get anything unless you are willing to pay top dollar. And it becomes kind of a competition. Once you bid on that canoe, you aren’t going to let it go until you “win”.

I went to a Scout auction one time, following a Jamboree. Canadian Tire, the store we love to hate but secretly all love, had donated canoes and bikes and tents all for free (I am sure they took a tax deduction equal to their actual costs) and then when the Jamboree was over the bidding began. Everything went for more than you could buy the said item for in store! Mind you it was charity and a good cause. But still! There must have been 200 bikes and 100 canoes and they all went for over retail! And the price of the bikes kept going up as people realized they were running out and they weren’t going to get a “Scout bike” if they didn’t pay up!

#100 Mountain Camper on 03.15.21 at 8:21 pm

#43 Axehead
Where Jason lives in Alberta means everything. A quarter section of land can cost from 240k (in bum-scratch Peace River swampland country) to well over 800k (if number 2 soil) to millions (if near any major city). And if he has Bison, then he has expensive fencing for those Bison, and those Bison are worth a small fortune (think multiple thousands per head).

I don’t understand the illegal trailer part – if you own a quarter section in Alberta you can build or store anything you damn well please on it. Only subdividing (depending on the county) is restricted.

My guess is the guy is worth $1M+.

All this to say, he should have no problem buying a house. Alberta housing (except Calgary, recently) has trended lower and lower for the past 6 years since T1 waged war on Alberta O&G and former Premier Notley drove us into debt. Check out prices online in smaller cities like Red Deer and Lethbridge or even Edmonton or Stettler and you’ll be able to find a nice house for $300k or an acreage for around $500k (4 acers with services and a house).
——————-
I live in Red Deer and it’s a nice place,but I would chose Lethbridge.What a beautiful place with better economy.

#101 The Woosh on 03.15.21 at 8:26 pm

#51 Dogman01 on 03.15.21 at 4:55 pm
#17 Soooooooo, I have been thinking about a moniker we could hang on our current PM.

————————

Little Lord Fauntleroy

“A person who is spoiled, conceited, and characterized by a pompous air of decadence, intellectualism, and moral superiority.”

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

————————————————

For a second I thought you were describing Sail Away. Honestly, it was the first thing I thought of when I read this. LMAO. I’m still chuckling!

#102 Nonplused on 03.15.21 at 8:27 pm

#30 Dr V on 03.15.21 at 3:36 pm
9 cuke and tomatoes

“put three children through real universities with a
car.”

This could mean:

1) In order for a university to be “real “, it must have a car

2) That the universities you chose had such low entrance requirements they also enrolled and graduated cars.

3) one car was bright enough to obtain three degrees.

———————————–

Despite your very intentional misreading, I did giggle.

#103 Don Guillermo on 03.15.21 at 8:30 pm

#98 Don Guillermo on 03.15.21 at 8:15 pm
#93 crowdedelevatorfartz on 03.15.21 at 7:21 pm
@#77 Ponzie’s Political Poilievre Pirouette

“That guy should cross to floor.
He’d be quaranteed to move up quickly.”

++++

Trudeau couldnt handle a guy named Pierre replacing him.
^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
EXPECTING A DELETE. Should’ve said:

T2 has no interest in being around competent people period.

#104 Bob Dog on 03.15.21 at 8:30 pm

Always pointing the finger at the borrower and never the lender. If Canada sees a correction like the us had in 2007, will CMHC make the banks whole with tax dollars?

Doesn’t this mean the banks are engaging in predatory lending. Isn’t the government a criminal organization for taking us down this path.

#105 Nonplused on 03.15.21 at 8:46 pm

#69 Rainman on 03.15.21 at 5:33 pm
People who come to live here, work and amass a down payment over time are called ‘Canadians.’ – Garth

A good play on words, but at the end of the day the fact that more people are here creates more demand. So yes immigration drives housing to a certain degree. Supply and demand concept…

————————————

I have often argued in this comments section that immigration should be tied to unemployment. Less than 4% (the supposed “natural rate”), let them in. Over 4%, slow it down. But I don’t think housing prices should factor into it. With the Canada born population on decline, if we stopped immigration entirely we would some 20-30 years from now have a whole lot of empty houses and unfilled job positions.

My position has always been that immigration policy should be set to favor already landed Canadian citizens. But that doesn’t mean zero immigrants. It means 4% unemployment, IMHO.

And I don’t know what housing has to do with it. Why can’t immigrants be employed building houses? Then they can use the money they earn to buy said new house, and borrow money from the bank, and I can buy preferred shares in said bank. Retirement paid for! Thanks immigrants!

All I am saying is that immigration policy should be good for Canadians. The number will not be zero unless we have a baby boom. We should take what we need. Selfish, sure, but Canada cannot save the world. Always put your own oxygen mask on first.

#106 Doug t on 03.15.21 at 8:49 pm

#74 cowman

Spot on – my brother lives in Welland and has looked into all of this – and sadly it’s true – and sadly the fruit belt is disappearing- southern Ontario Is turning into the concrete jungle and natural habitat will be gone for good

#107 DON on 03.15.21 at 8:57 pm

#86 gfd on 03.15.21 at 6:24 pm
Just received this one from a GTA realtor (Durham).

“THE HOUSING MARKET IS SHIFTING!…hey guys, welcome to my March newsletter. While the numbers for the market will be mentioned in my 5-minute market update video below, I think it’s important to mention the fact that the video was done a few days ago (still correct – interestingly) and the market has shifted, and is shifting. As per my earlier predictions, things have slightly slowed down as we have now gotten to that number of 10,000 active listings in inventory. I’m noticing not as many offers on properties, with some being relisted at higher prices and no offer dates. So, while it still is definitely a sellers’ market (super-sellers’ market to be more accurate), it’s not the same as before. I’ve seen many listings start out with offer dates, not get what they want on those dates, and get relisted at a higher (see – realistic/accurate) price. That said, inventory is still not where it should be . . . . . .”

Patience may very well be the key!

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

Isn’t this considered blasphemy?

#108 Nonplused on 03.15.21 at 9:05 pm

#90 david prokop on 03.15.21 at 6:48 pm
The rental market is also insanely expensive.
Makes me wonder why would so many immigrants want to come here? Most will be making minimum wage for start and will never own a place

————————————-

Half of the home owners on my little cul-de-sac are immigrants and speak with varying funny accents. I probably have the cheapest lot on the cul-de-sac and you won’t get me out of it for less that $1 million. (I have the worst view of the valley and mountains).

So what do my immigrant friends do? (And they are friends, we social distance drink together.) Well, there is a doctor, 3 IT people, an oil patch VP, an oil patch China importer, 2 retired accountants, and a couple of folks that keep to themselves but have nice houses. None of them drive cabs.

Now lets go over to my son’s soccer team. Despite what people say, soccer isn’t cheap. The average color of my son’s team is brown. The kids really don’t seem to care. Now there are some teams in the league that are more black, and some that are more white, but as a whole I would say that is the parents making choices. The kids, so far as I can tell, do not care. Anyway my point is that these immigrants can muster up $2000 a year for their kid to play soccer year round. Not minimum wage.

#109 John in Mtl on 03.15.21 at 9:12 pm

@ #10 Dogman01 on 03.15.21 at 2:21 pm


We don’t acknowledge this and do something about it:
“In sum, Canada has the same problem as many of our children: high self-esteem without high levels of achievement.”

China: We have reached the “tipping point” by giving away the store to a nasty totalitarian dictatorship in China.
“We will bury you” ; What the Soviet Union could not accomplish the Chinese simply did by appealing to the greed of the West’s established elite.

.

You are soooo right my man! Took the thoughts right out of my mind.

But of course, nobody listens.

#110 TurnerNation on 03.15.21 at 9:12 pm

In spite of this weblogs’ optimistic words this New System is not going away.
…..

FOI request to Ottawa Public Health: “There is no intention to end the mask mandate in Ottawa. We are officially chasing zero cases. Even with mass vaccination we will still be wearing masks.”(twitter.com)

https://twitter.com/GovGone/status/1371509264842432513

#111 Ottawan on 03.15.21 at 9:13 pm

CMHC’s role is to provide political inertia.

#112 Out Of Work CEO, Will Travel on 03.15.21 at 9:19 pm

The best solution for our made in Canada unaffordable housing crisis is a made-in-Japan solution. Japan has a high 10% vacancy in their housing market and very low prices due to the “Excess supply”. The aging and declining population with virtually no immigration nets very high housing solution. Note how cheap this solution is as the government does not have to tax Canada or spend on the problem. The best solution is a no tax solution and a made in Canada solution.

#113 willworkforpickles on 03.15.21 at 9:21 pm

Debt has ruined many and harmed every country in every recession until now.
Until they decided… that is, they wouldn’t let it the next/this time around with runaway money printing.
Runaway money creation now gone far beyond the point of no return. (repayment) & (all new debt creation just to service old debt creation)

…never say like never before…. as we cannot.

All recessions/depressions have seen many an overextended deeply indebted soul, even nation fail and fail miserably.

Civilizations of the past… no different.

…but civilizations of the past that took debt creation past the point of no return like this one (in our time)… (and that’s the difference now) – have ceased to exist altogether.
Mortal men then…mortal men now…same end result.
Ignore debt at your own peril.
The winds of change are gathering….and a cat 5 is coming.

#114 Drill Baby Drill on 03.15.21 at 9:21 pm

Dear Blog God you are far to jovial and optomistic in today’s column about our current lineup of politicians and retarded home buyers. Canadians please be patient and let this FOMO play out this is insanity personified.

#115 BCWally on 03.15.21 at 9:26 pm

Thanks #1 “Party on Garth” for that information. That central bank balance sheet was the one I was really looking for.
I’m assuming everybody has the same question – how to navigate a true nation wide credit contraction. I don’t think we have had a true contraction for decades.
I’m thankful for this blog….and most everybody who contributes to it with their thoughts and articles.
The testimony of the people that were around in the last contraction is invaluable.

#116 DON on 03.15.21 at 9:35 pm

#82 Winner? on 03.15.21 at 6:14 pm
This filed as a 74 year old in the process of selling a central Toronto family home, part of a group not mentioned much in this blog, beyond implications we undeserved profiteers. I stand to receive many Canadian pesos now, when I don’t need them. Sorry, I don’t plan everything.

The backstory is the story: In 1984 I stuck out my financial neck to buy an interesting central city place beyond my means, hoping some rental income from part of it would balance the books. It did…sorta. With debt costs what they were, for a long period, our family -a ‘big’ one by Toronto measures, was house-poor. Despite a good reliable income on my own part, frugality by my family, we paid a high price for living in the City I worked for, and satisfy our own long traditions of urban people who liked affinity with other urban people, family, friends or colleagues.

To this day wonder whether the debt trap that ensued for a long time was worth it. It distorted our household finances and opportunities for a long time. The current RE hysteria in Toronto, or the proceeds of this sale, which will be given to my kids so they can perhaps afford to do something, somewhere, is kinda a zero-sum game.

The last option apparent for individuals concerned about today’s RE circumstances is to not play the game. If I had a better idea would share it.

In an uncertain world, debt obligations are certain. You bin warned. Or…to sketch the big picture, think of central Toronto now as a gated community. You may or may not have the price of admission, but we all know what it is.

********

All the best and thank you for the insight.

Treat yourself well.

#117 Reality is stark on 03.15.21 at 9:40 pm

Ah yes. The winds of change.
Biden is determined that the “rich” are going to pay for the pandemic. But you can be sure that he is not going to stop there. “Make America mediocre” is the new democratic slogan. A bloated Washington bureaucracy is a given.
Here in Canada we brag about our 9.5% unemployment rate because higher unemployment leads to much higher house prices. This in turn logically has us bidding prices higher as there is no immigration.
As North America turns into a high tax regime you’ll notice that even your reasonably educated offspring will be unable to find meaningful work.
You pretty much need a doctorate to become a pharmacist today. The holy grail is a public service job with a pension. That is our new definition of aiming high.
We are simply no longer competitive and our government is eager to push cultural Marxist propaganda. A recipe for disaster. The marriage rate is tanking as the left teaches us that the genders are the same, not complimentary.
The young are confused and deluded. Marriage counsellors realize the extent of the “Masculinity
Paradox/Complex” but have no way of preventing inevitable divorce.
Western society has been in decline for a while but much higher taxes are not the panacea that the great Joe Biden/Justin Trudeau would have you believe.

#118 Prince Polo on 03.15.21 at 9:49 pm

https://tinyletter.com/acs171/letters/known-unknowns-44

“I heard someone say MMT has become an accepted theory – that is simply not true. And there is nothing new here. If you look at the history of debt cycles and financial crisis, they often featured some convoluted justification for why taking on tons of leverage isn’t so risky after all because this time was different – we are so much more clever now.”

#119 Sail Away on 03.15.21 at 10:10 pm

#101 The Woosh on 03.15.21 at 8:26 pm
#51 Dogman01 on 03.15.21 at 4:55 pm

#17 Soooooooo, I have been thinking about a moniker we could hang on our current PM.

————

Little Lord Fauntleroy

“A person who is spoiled, conceited, and characterized by a pompous air of decadence, intellectualism, and moral superiority.”

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

————

For a second I thought you were describing Sail Away. Honestly, it was the first thing I thought of when I read this. LMAO. I’m still chuckling!

————

Keep laughing, Woosh. You should then also add airborne ranger, sergeant, Gulf war veteran, all-army light heavy boxer and solo bluewater sailor. Look it up.

It sounds like you’ve formed a foppish picture of me. Be careful with that.

#120 Axehead on 03.15.21 at 10:23 pm

#100. And Lethbridge also makes good beer.

#121 Drew on 03.15.21 at 10:32 pm

They may have little impact but the sentiment among people I talk to is its foreign buyers, and “the rich” buying up all the supply, and if most voters think that that’s enough. People don’t want to hear its their recklessness that’s the issue.

They also believe rates won’t go up “because I’ve heard that for years and they never have”

2019 they went up what? 0.75 and people lost their minds. Let rates raise and the bubble burst I say.

Politicians will want to meddle to prevent that, they can’t help it. I really hope I’m wrong.

#122 Dogman01 on 03.15.21 at 10:33 pm

#109 John in Mtl on 03.15.21 at 9:12 pm

There may come a day when the power calculations are done wrong and the West butts up with China militarily.

Our established elite have lost all allegiance to anything but themselves, they believe in Globalism; —the freedom to structure commercial relationships and social enterprises without reference to the well-being of the particular society in which they happened to make their livings and raise their children.

In a crisis they will realize China has no place for them in its power center; they will utilize patriotism, propaganda and the media in an attempt to mobilize support. They will become desperate when they realize the West can no longer build a fighter plane or missile or ship without a critical component from the supply chain in China….. and that industrial powerhouse they have created by rapacious offshoring can build a dozen for every one the West can …..the jig will be up, checkmate. The China century economically and militarily.

And left wing Canadians think the USA was a bad hegemon…they ain’t seen China in charge.

#123 Two-thirds on 03.15.21 at 10:52 pm

“The market can stay irrational longer than you can stay solvent”

So yes, patience, but also, acceptance.

Acceptance that if Canadian places self-fashion “world class” the housing picture should be also “world class” (i.e., very much un-affordable).

Most places in the world, have a large proportion of forever renters, who lead happy, fulfilled, secure lives. Only the minority own real estate and these countries (predominantly in Europe) seem to do well for themselves, so why should this not be the case in Canada?

If however, we as a society have an insatiable demand for housing, we must also accept that increased demand and constrained supply will inevitably lead to higher prices. Emergency interest rates have added fuel to the fire, for sure, but even pre-covid, a mortgage in the 3% range was available, which by all measures is a very low rate!

So, sure, double current rates and we are back to…2018, 3-3.5% rates. A correction will be welcome, but will not make housing affordable, simply downgrade it from absurd, to still very expensive.

Patience, sure, but realism along with it should be de rigeur for fence sitters.

#124 Cici on 03.15.21 at 11:03 pm

#30 Dr V

I thought it meant he put the three children into a car which literally crashed through the “real” university after the transmission was engaged and the brake released?

#125 Long-Time Lurker on 03.15.21 at 11:04 pm

Free your mind…

…There is no Prime Minister Zoolander….

For the Alberta Country Mouse:

Sustainable Micro Straw Bale Cabin with Passive Solar Green Roof
185,919 views•Mar 15, 2017

Exploring Alternatives
This micro cob and strawbale cabin was built by local artisans as a vacation rental at the Terra Perma (https://terraperma.ca/en/stay/accommo…​) eco resort and village in Harrington, Quebec, Canada….

https://www.youtube.com/watch?v=RSPCj4e8n6Y

#126 good2all on 03.15.21 at 11:16 pm

the canada wide virus lock-down a year ago was triggered by someone who lives in 24 susex tested positive. what would be the trigger cooling down the dangerous and crazy R.E. this time? may be we need to wait until someone in that address was out-bidded for a house?

Irresponsible and incapable politicians !

#127 Louise on 03.15.21 at 11:27 pm

Canada needs to cut out the need to have a buyers agent like the Australian system. Would be transparent. No blind bidding wars. Plus would encourage sellers to sell due to lower cost.

#128 The real Kip (Ret) on 03.15.21 at 11:27 pm

There will be no change until the federal election (whenever that is) is over.

#129 Winterpegosis on 03.15.21 at 11:49 pm

#98 Axehead on 03.15.21 at 8:13 pm
#79 Nelson,

My point exactly, eastern Alberta is pretty much Saskatchewan. Cheap land. It all depends on location.

______________________

But then again, Saskatchewan is pretty much Manitoba, so you’re practically asking the poor sap to move to Winnipeg!
Stick with the mice and quit complaining!

#130 Sail Away on 03.15.21 at 11:52 pm

Get a mink for the rodents:

https://youtu.be/rrheoEEKMcs

#131 Saquib S on 03.16.21 at 12:00 am

I sucked it up and bought…a semi in Brampton for $1,080,000…($80k above ask).
Yup, I’m officially a greater fool.

#132 Garth's Son Drake on 03.16.21 at 12:00 am

I would not be hiring those lawyers. Confused over 3x earnings income being affordable or not?

Remember that if rates go up, the stress test will go bye, bye just like Evan. They are keeping it as ammo to smooth out these adjustments.

Wake me up if rates go / stay above 5%.

My view is lower for longer. Called it in 2009 and boy have I been right so far. The call was for at least 30 years of low rates. The year 2040.

I still think rates are going negative at some point. I guess we will see. Anyone sitting on cash have and will continue to be left behind.

#133 Karlhungus on 03.16.21 at 12:16 am

Just get rid of the CMHC. Problem solved

#134 morrey on 03.16.21 at 12:56 am

“Canada’s housing bubble just won’t burst”

.

#135 antisocial social club on 03.16.21 at 12:59 am

immigrant- a person who leaves one country to permanently live in another.
Does he need a home? Yup! Will he buy one?Probably.

#136 Tim123 on 03.16.21 at 1:11 am

The world economy is expected to grow at 5.5% in 2021. The US is predicted to grow at 6.8% by Goldman Sachs. I predict inflation will arise in 2022 and interest rate hikes by central banks. Interest rate increases cause housing prices to fall historically and this time will be no different. Nothing goes up forever so a big housing correction is likely to start in 2022-2023

#137 Wrk.dover on 03.16.21 at 7:00 am

#91 Sail Away on 03.15.21 at 7:08 pm

Office monthly salary: $140,000

Good eye. I wondered if anyone would notice. That’s actually the biweekly salary number.

So, thanks for the chance to correct. Monthly salary: $280k.

XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX

Fail! the multiplier is 2.2 (2.172619)

$304,000 monthly salary (304,166.66)

There are 30.5 (30.416) days in a month
(365 divided by 12)

Divide that by 14 for biweeklies

I thought engineers did mathy stuff well?

#138 Bert on 03.16.21 at 7:08 am

The value / cyclical re opening trade is wildly extended. Risk is extremely high. Growth / tech is under owned. Be very careful with cyclical ETFs and re opening themes here. They could underperform for a significant period of time going forward.

#139 Bert on 03.16.21 at 7:11 am

Healthcare and biotech are the most hated sectors currently. These are long term secular growth sectors.

#140 Bert on 03.16.21 at 7:14 am

Large traders are more short long term bonds than they have ever been in all of history. It’s likely rates head lower and bond prices grind higher here. The trade is EXTREMELY crowded. Be careful!

#141 B on 03.16.21 at 7:56 am

That dog is looking into the Giant Tiger Express at the corner of Wellington and Pinhey in Ottawa’s Hintonburg neighborhood. A notorious Hell’s Angels clubhouse just sold in the neighborhood, not 500 m from here!

#142 crowdedelevatorfartz on 03.16.21 at 8:31 am

@#103 Don Guillermo

“T2 has no interest in being around competent people period.”

+++

The appointment of former journalist Chrystia Freecash as Finance Minister has made that painfully clear.

#143 IHCTD9 on 03.16.21 at 9:23 am

#131 Saquib S on 03.16.21 at 12:00 am

… bought…a semi in Brampton for $1,080,000…

_______

HaHaHa! Good one!

That was a joke right?

#144 Damifino on 03.16.21 at 9:23 am

Alex Astbury, long time Atlantic real estate agent now working out of Lunenburg puts it this way:

Then all of a sudden, the arse was right out of ‘er again

Beautiful! I’m not buying or selling in Nova Scotia, but if I were, Alex would be my choice, hands down.

https://nationalpost.com/news/canada/real-estate-in-atlantic-canada-in-a-whirlwind-of-demand-with-prices-blowing-sky-high

#145 crowdedelevatorfartz on 03.16.21 at 9:40 am

@#141 B
” A notorious Hell’s Angels clubhouse …”

+++

As opposed to a non notorious Hell’s Angels clubhouse?

#146 Dharma Bum on 03.16.21 at 9:41 am

Crowdie – from yesterday:

“Please tell me where you buy your pot.”
————————————————————————-

You forgot?

I bought it off you. In an elevator. Best – ride – ever.

#147 willworkforpickles on 03.16.21 at 9:56 am

The USA is in dire need of another Ronald Reagan type leader that will not come in time.
The US has lost its edge in cyberspace high tech and its adversaries actually lead now in cyberspace warfare technology.
This does not bode well for the future of defence/offensive capabilities for a severely indebted embattled US on all fronts.
Being at the point of no return where rampant debt creation spirals into a debt abyss where near every new dollar of debt spun out goes to servicing the growing debt monster it created (well beyond par to debt to GDP ratios)…funds to keep America on the cutting edge of defence and military capability have fallen far behind.
The clock is ticking toward the very end of American civilization as we know it. Our adversaries continue to forge ahead relentlessly technologically and capability-wise toward that end.
…it will come sooner than most can imagine even possible…and it will come.

#148 The Woosh on 03.16.21 at 10:12 am

#119 Sail Away on 03.15.21 at 10:10 pm
#101 The Woosh on 03.15.21 at 8:26 pm
#51 Dogman01 on 03.15.21 at 4:55 pm

#17 Soooooooo, I have been thinking about a moniker we could hang on our current PM.

————

Little Lord Fauntleroy

“A person who is spoiled, conceited, and characterized by a pompous air of decadence, intellectualism, and moral superiority.”

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

————

For a second I thought you were describing Sail Away. Honestly, it was the first thing I thought of when I read this. LMAO. I’m still chuckling!

————

Keep laughing, Woosh. You should then also add airborne ranger, sergeant, Gulf war veteran, all-army light heavy boxer and solo bluewater sailor. Look it up.

It sounds like you’ve formed a foppish picture of me. Be careful with that.

——————————————

What do you mean by “Be careful with that.”? Is that a threat? Are you that foolish?

Garth…I thought this was a moderated site. Subtle and not so subtle threats are permitted now?

#149 Dharma Bum on 03.16.21 at 10:14 am

The government will never interfere to “cool” house prices.

Canadians have one of the highest home ownership rates.

It’s roughly a 70-30 split. So, the guv will always look to that 70% majority to pander to. Interference that drops house prices will piss off anyone who already owns.

Federal interference that lowers house values will guarantee that the sitting power will not be re-elected. That is ALL they care about. Power and the maintenance of it.

Expect house prices to go up, up, up, in the long run.
Yes, there will be dips, stagnation, and longer stretches of flatlining and decline. But over decades, your house will increase in value. Listen to Captain Uppa. He knows best.

https://fred.stlouisfed.org/series/QCAR628BIS

#150 Sail Away on 03.16.21 at 10:33 am

#137 Wrk.dover on 03.16.21 at 7:00 am
#91 Sail Away on 03.15.21 at 7:08 pm

Office monthly salary: $140,000

Good eye. I wondered if anyone would notice. That’s actually the biweekly salary number.

So, thanks for the chance to correct. Monthly salary: $280k.

———

Fail! the multiplier is 2.2 (2.172619)

$304,000 monthly salary (304,166.66)

There are 30.5 (30.416) days in a month
(365 divided by 12)

Divide that by 14 for biweeklies

I thought engineers did mathy stuff well?

———-

Haha. Rough numbers.

Anyway, the point of the story is that office is only a small cost in the overall scheme and if WFH drops efficiencies by 5-6%, everyone returns.

#151 crowdedelevatorfartz on 03.16.21 at 10:43 am

@#148 The Woosh

“What do you mean by “Be careful with that.”? Is that a threat? Are you that foolish?”

+++

Do you need a safe space?
Soothing pink padded walls ?
A large pillow to vent your anger?

#152 Sara on 03.16.21 at 10:53 am

#119 Sail Away on 03.15.21 at 10:10 pm
#101 The Woosh on 03.15.21 at 8:26 pm
#51 Dogman01 on 03.15.21 at 4:55 pm

#17 Soooooooo, I have been thinking about a moniker we could hang on our current PM.

————

Little Lord Fauntleroy

“A person who is spoiled, conceited, and characterized by a pompous air of decadence, intellectualism, and moral superiority.”

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

————

For a second I thought you were describing Sail Away. Honestly, it was the first thing I thought of when I read this. LMAO. I’m still chuckling!

————

Keep laughing, Woosh. You should then also add airborne ranger, sergeant, Gulf war veteran, all-army light heavy boxer and solo bluewater sailor. Look it up.

It sounds like you’ve formed a foppish picture of me. Be careful with that.

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

Don’t forget to add “unpretentious” to that picture.

#153 KLNR on 03.16.21 at 11:09 am

@#101 The Woosh on 03.15.21 at 8:26 pm
#51 Dogman01 on 03.15.21 at 4:55 pm
#17 Soooooooo, I have been thinking about a moniker we could hang on our current PM.

————————

Little Lord Fauntleroy

“A person who is spoiled, conceited, and characterized by a pompous air of decadence, intellectualism, and moral superiority.”

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

————————————————

For a second I thought you were describing Sail Away. Honestly, it was the first thing I thought of when I read this. LMAO. I’m still chuckling!


Bwahahaha.
little lord sail away.

#154 Cowtown Cowboy on 03.16.21 at 11:30 am

#148 The Woosh on 03.16.21 at 10:12 am
#119 Sail Away on 03.15.21 at 10:10 pm
#101 The Woosh on 03.15.21 at 8:26 pm
#51 Dogman01 on 03.15.21 at 4:55 pm

#17 Soooooooo, I have been thinking about a moniker we could hang on our current PM.

————

Little Lord Fauntleroy

“A person who is spoiled, conceited, and characterized by a pompous air of decadence, intellectualism, and moral superiority.”

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

————

For a second I thought you were describing Sail Away. Honestly, it was the first thing I thought of when I read this. LMAO. I’m still chuckling!

————

Keep laughing, Woosh. You should then also add airborne ranger, sergeant, Gulf war veteran, all-army light heavy boxer and solo bluewater sailor. Look it up.

It sounds like you’ve formed a foppish picture of me. Be careful with that.

——————————————

What do you mean by “Be careful with that.”? Is that a threat? Are you that foolish?

Garth…I thought this was a moderated site. Subtle and not so subtle threats are permitted now?

—————————————————————-

Ahhh, what’s the matter snowflake, need your safe space??? Have to go crying to our gracious host that you feel scared…call a man out, expect him to not take it sitting down…punk

Enough. – Garth

#155 TurnerNation on 03.16.21 at 11:34 am

The Economy: this is being dragged out in all the Former First World Countries. Lockstep UBI? Maybe.

– German ICU doctors call for ‘immediate return’ to lockdown as Covid-19 numbers rise(thelocal.de)

– Paris may face new Covid-19 lockdown to prevent a spike in cases(france24.com)

– [UK] Home Office to pass new powers for police to tackle protests that cause ‘noise disruption’ (independent.co.uk)

– Scotland: Keeping children safe at school. Picture of first day of kamp:
https://i.redd.it/e803rowqu6n61.jpg

— Wait a sec…last time I read a headline this it was September 2019. What happened to the equity markets a few months later..

Globe says TD, rivals hear “repo” market under pressure
The Globe and Mail reports in its Monday, March 15, edition that the Bank of Canada has expanded the size of its daily bond sale and repurchase program. The Globe’s Mark Rendell writes that the BOC owns nearly 40 per cent of the federal government bond market as a result of its $4-billion-a-week bond-buying program, also known as quantitative easing, or QE. This is putting pressure on the “repo” market, a key funding market for financial institutions, where dealers swap bonds for cash on a short-term basis. With more bonds on the BOC’s balance sheet, there are fewer available for private-sector institutions. That means more money chasing fewer bonds in the repo market, bidding up their price and causing the benchmark Canadian Overnight Repo Rate Average to trade below the BOC’s 0.25-per-cent target for overnight funding. Bonds are said to trade “on special” in the repo market when demand outstrips supply. On Friday, the BOC adjusted its securities repo operations (SROs) to increase the availability of government bonds to financial market participants. The BOC said it would make $2-billion worth of bonds and treasury bills available daily to each primary dealer, up from $1-billion.© 2021 Canjex Publishing Ltd. All rights reserved.

#156 Sara on 03.16.21 at 11:38 am

#151 crowdedelevatorfartz on 03.16.21 at 10:43 am
@#148 The Woosh

“What do you mean by “Be careful with that.”? Is that a threat? Are you that foolish?”

+++

Do you need a safe space?
Soothing pink padded walls ?
A large pillow to vent your anger?
=================

Don’t worry CEF, SA is a big boy and can take care of himself. No need for you to always step in to try and attack his criticizers.

#157 IHCTD9 on 03.16.21 at 11:45 am

#147 willworkforpickles on 03.16.21 at 9:56 am
The USA is in dire need of another Ronald Reagan type leader that will not come in time.
The US has lost its edge in cyberspace high tech and its adversaries actually lead now in cyberspace warfare technology.
This does not bode well for the future of defence/offensive capabilities for a severely indebted embattled US on all fronts.
Being at the point of no return where rampant debt creation spirals into a debt abyss where near every new dollar of debt spun out goes to servicing the growing debt monster it created (well beyond par to debt to GDP ratios)…funds to keep America on the cutting edge of defence and military capability have fallen far behind.
The clock is ticking toward the very end of American civilization as we know it. Our adversaries continue to forge ahead relentlessly technologically and capability-wise toward that end.
…it will come sooner than most can imagine even possible…and it will come.
____

Just to bring your points into the current day – and the near future:

1. Nothing in the world can touch the USA on land, sea, or air. Not even close. The USA is the only superpower on earth that can project power, and even Russia and China are decades from floating anything that can traverse the globe. Once the US ship mounted Rail Guns and Lasers are fully developed – long range missiles (hypersonic included) will be obsolete. Nothing will topple US military power in our lifetimes, they are way too far ahead.

2. The future of military and economic influence is Global, not National. Did you notice Biden had a little E-visit with Indian, Japanese and Australian leaders last week? The entire Globe is gradually coming together on multiple fronts – those who want to go it alone will lose.

99% of all Global military power is concentrated in the West, so is over 70% of all economic power. Looks like India is making some very good choices – this will be very problematic for China in the future.

A wide angle lens reveals that international borders are thinning, and will likely be informal relics of the “old system” decades from now. We are living in a transitional phase: the final gathering of people together in preparation for the emergence of a Type 1 Global Civilization. The evidence is everywhere you look.

#158 Sail Away on 03.16.21 at 11:46 am

#152 Sara on 03.16.21 at 10:53 am

Don’t forget to add “unpretentious” to that picture.

———–

Good idea:

‘…as well as unpretentious, handsome, suave, sophisticated, and stunningly intelligent.’

Thanks!

#159 Flop... on 03.16.21 at 11:49 am

Can I pull this thread out of the gutter?

Probably not…

M46BC

Median U.S. Home Prices and Housing Affordability by State.
“The coronavirus pandemic is reshaping the U.S. economy in a lot of different ways, especially the housing market. COVID-19 has sent office workers looking to move away from major cities and into the suburbsfor more space, and historically low mortgage interest rates have added further fuel to an already hot market. But most households cannot comfortably afford to own a house, as our latest map of median U.S. home prices illustrates.

Vermont is the least affordable state in the country, with only 16% of households able to easily afford a mortgage payment for a new median price home costing $476K.

Not every state in the Northeast has a massive housing affordability problem. Delaware is the most affordable place in the entire country because some 69% of households can afford a home worth about $193K.

Housing affordability is a real problem in largely rural states like Wyoming (23%) as well as states with large urban areas, like New York (26%).

A close look at our map reveals how different income levels between states directly plays into the housing affordability crisis. The same proportion of households can afford a home in California as Arizona (33%), but the median new home price is vastly different ($527K vs. $416K, respectively).”

https://howmuch.net/articles/home-affordability-in-the-US

#160 looking up on 03.16.21 at 11:52 am

#153 KLNR on 03.16.21 at 11:09 am
@#101 The Woosh on 03.15.21 at 8:26 pm
#51 Dogman01 on 03.15.21 at 4:55 pm
#17 Soooooooo, I have been thinking about a moniker we could hang on our current PM.

————————

Little Lord Fauntleroy

“A person who is spoiled, conceited, and characterized by a pompous air of decadence, intellectualism, and moral superiority.”

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

————————————————

For a second I thought you were describing Sail Away. Honestly, it was the first thing I thought of when I read this. LMAO. I’m still chuckling!


Bwahahaha.
little lord sail away.

——

Actually I consider Whale Away er ah I mean Sail Away more of a court jester than a lord Lol.

#161 IHCTD9 on 03.16.21 at 11:57 am

#148 The Woosh on 03.16.21 at 10:12 am
#119 Sail Away on 03.15.21 at 10:10 pm

Keep laughing, Woosh. You should then also add airborne ranger, sergeant, Gulf war veteran, all-army light heavy boxer and solo bluewater sailor. Look it up.

It sounds like you’ve formed a foppish picture of me. Be careful with that.

——————————————

What do you mean by “Be careful with that.”? Is that a threat? Are you that foolish?

Garth…I thought this was a moderated site. Subtle and not so subtle threats are permitted now?
_____________________

That was the quickest corkscrew into lala land I’ve ever seen.

Woosh, for your benefit, here is what a threat sounds like:

“If you don’t shut your pie-hole, I’m gonna knock your teeth out”.

Good grief, relax homie.

#162 Cats are evil on 03.16.21 at 12:02 pm

Patient doggo…..

https://twitter.com/dog_rates/status/1371622056496754690?s=19

#163 The West on 03.16.21 at 1:25 pm

#123 Two-thirds

“The market can stay irrational longer than you can stay solvent”

So yes, patience, but also, acceptance.

Acceptance that if Canadian places self-fashion “world class” the housing picture should be also “world class” (i.e., very much un-affordable).

Most places in the world, have a large proportion of forever renters, who lead happy, fulfilled, secure lives. Only the minority own real estate and these countries (predominantly in Europe) seem to do well for themselves, so why should this not be the case in Canada?

If however, we as a society have an insatiable demand for housing, we must also accept that increased demand and constrained supply will inevitably lead to higher prices. Emergency interest rates have added fuel to the fire, for sure, but even pre-covid, a mortgage in the 3% range was available, which by all measures is a very low rate!

So, sure, double current rates and we are back to…2018, 3-3.5% rates. A correction will be welcome, but will not make housing affordable, simply downgrade it from absurd, to still very expensive.

Patience, sure, but realism along with it should be de rigeur for fence sitters.
————————————-

Spoken like a true Trudeau voter. “We will be serfs and, we will be happy about it.”

Boots don’t taste good to me – doesn’t matter whose wearing them.

Don’t worry 2/3 – you will own nothing and you will be happy.

#164 Planetgoofy on 03.16.21 at 1:35 pm

Timing RE is a fools errand.
I own alot of it. But what is nuts is a $800,000 offer on a vacant lot I have it aint even for sale! assesments $160k..
I might add a very desirable piece with a couple 100k of prime timber on it which im loghing now. Last vaccant industrial piece south of town on the sunshine coast.
Still bat sh!t.

#165 Planetgoofy on 03.16.21 at 1:39 pm

PS yup there is no crash ahead. It total currency debasement.
https://financialpost.com/executive/posthaste-average-canadian-home-prices-have-shot-up-100000-in-6-months-but-dont-expect-a-market-crash-anytime-soon

#166 jess on 03.16.21 at 2:14 pm

repatriated: a circle game ?

https://www.justice.gov/usao-sdny/pr/zurich-s-oldest-private-bank-admits-helping-us-taxpayers-hide-offshore-accounts-irs

IRS-CI Chief James C. Lee said: “Through a years-long scheme, the R+B bank hid the assets of U.S. accountholders to shield them from their tax obligations. Today’s admission and agreement provide a clear path to recovery of funds owed to the U.S. government, and sends a strong signal that offshore accounts are not beyond the reach of special agents with IRS CI.”

According to the Agreement, the accompanying Statement of Facts, and other documents filed today in Manhattan federal court:

From at least in or about 2004 and continuing until at least in or about 2012, R+B conspired with certain of its U.S. accountholders and others to defraud the United States with respect to taxes, file false federal tax returns, and commit tax evasion. R+B’s bankers assisted U.S. accountholders in concealing their ownership and control of assets and funds held in undeclared R+B accounts, which enabled those U.S. accountholders to evade their U.S. tax obligations. R+B admitted to holding undeclared accounts on behalf of approximately 340 U.S. taxpayers, who collectively evaded approximately $16.4 million in U.S. taxes between in or about 2004 and in or about 2012. The assets under management that R+B held for undeclared U.S. accountholders increased from approximately $391 million in 2004 to approximately $550 million in 2007, its peak year for undeclared assets under management.

In furtherance of the scheme to help U.S. taxpayers hide assets from the IRS and evade taxes, R+B undertook the following actions, among others:

R+B opened “numbered” or “pseudonym” accounts for U.S. accountholders in order to reduce the risk that U.S. tax authorities would learn their identities.

R+B opened and maintained accounts for U.S. accountholders in the names of non-U.S. corporations, foundations, trusts, or other legal entities, thereby helping U.S. taxpayers conceal their beneficial ownership of the accounts.

R+B agreed to hold bank statements and other account-related mail in Switzerland, rather than send them to the U.S. accountholders in the United States, which helped ensure that documents reflecting the existence of the accounts remained outside the United States and beyond the reach of U.S. tax authorities.

After Liechtenstein and the United States signed a Tax Information Exchange Treaty in December 2008, R+B transferred the undeclared assets of certain U.S. taxpayers from accounts held in the names of sham foundations organized under the laws of Liechtenstein to new accounts held in the names of new sham foundations organized under the laws of Panama, in an effort to further conceal the accounts from U.S. tax authorities.

R+B allowed U.S. accountholders and third-party asset managers to make withdrawals by check from undeclared accounts in amounts of less than $10,000, in an apparent attempt to conceal transactions from U.S. authorities.

On occasion, R+B opened accounts for U.S. taxpayers who were exiting UBS AG and other Swiss banks, and allowed these U.S. taxpayers to continue to conceal their undeclared assets at R+B. R+B additionally opened “escrow” accounts on behalf of a Swiss attorney to facilitate the transfer of undeclared assets of U.S. accountholders that had been converted to gold and other precious metals held in a vault at UBS.

R+B helped U.S. accountholders to repatriate funds to the United States in a manner designed to ensure that U.S. tax authorities did not discover the undeclared accounts, including by transferring the funds of one U.S. accountholder in increments of approximately $100,000 to another Swiss bank before the U.S. accountholder routed the funds to a diamond dealer in Manhattan, where the U.S. accountholder ultimately received them.

R+B, through its bankers, made regular visits to the United States to solicit, open, and service undeclared accounts of U.S taxpayers.

Under today’s resolution, R+B is required to cooperate fully with the Department of Justice and affirmatively disclose new information it may later uncover regarding U.S.-related accounts. R+B is also required to disclose information consistent with the Department’s Swiss Bank Program relating to accounts closed between January 1, 2009, and December 31, 2019.
https://www.justice.gov/usao-sdny/press-release/file/1375596/download

https://www.occrp.org/en/daily/14058-one-of-switzerland-s-oldest-banks-helped-us-citizens-evade-more-than-16-million-in-taxes
==================

#167 Randal Hunt on 03.16.21 at 2:19 pm

The roaring 20’s all over again. Followed by a worldwide depression. The difference this time is that there will no recovery from it. The resources and energy (especially energy) will not be adequate enough for growth. This will the last of the good times. Enjoy while it lasts.