Sticky fingers

Bob Kavcic isn’t pulling any punches. “There is now a full-scale attack on Canadian home prices across various levels of policy,” the BeeMo economist wrote in a note to clients. And, man, is he ever right. Especially after this week.

Not since the bubble-crushing government hamfists of 2017 have we seen anything like this. In fact this attempt by politicians to squish the real estate market promises to be far more effective – because the cost of money, everywhere, is galloping higher as they do it.

So, we’ve been yammering on tediously about bond yields, inflation, monetary policy, CBs and mortgages for a few weeks now. The blog told you what was coming. We told you as it happened. And we’re telling you now it’s just started. Mortgages which were 2% in January are heading for 4% in April and could be 6% in the autumn. This fact alone it a market-subduer if not a killer.

Then there’s human nature. Realtors, brokers, lending dudes – they’re all seeing it. Showings have dipped, multiple offers diminished, many houses failing to sell on the night of their blind auction and there are even lots of deals for (horror!) below ask.

The housing market is, after all, a self-fulfilling prophecy. When prices rise people are desperate to purchase because of FOMO – Fear of Missing Out. Buyers rush in convinced houses will cost more later. But when prices falter people are hit with FOOP – Fear of Over-Paying. Buyers back off, afraid houses will be worth less soon.

This is happening already. And late to the party, governments are piling on to make it all worse.

In Ontario this week the Ford government delivered a death blow to certain market segments by increasing the foreign buyer’s tax to a withering 20% and extending it to every corner of the province. The ‘non-resident speculation tax’ was created in 2017 at 15% and only hit sales in the GTA and Golden Horsehoe region.

On Wednesday the same crew tabled a bill intended to rip away red tape and expedite the construction of 1.5 million new housing units. The government wants higher densities along with rezoning of peaceful, leafy, expensive hoods to allow multi-unit structures.

In BC, Comrade Premier Horgan brought in amendments to the Property Law Act allowing a province-wide cooling-off period for house buyers. The length of time is unknown as yet, but the idea is to allow people to buy, then do due diligence and, if not satisfied, walk away.

Realtors and observers say this is beyond dumb. It would allow buyers to tie up multiple properties with no intention of actually closing any deal and no real financial incentive to do so. Sellers would be left in limbo, not knowing if a firm deal was firm or not. More market chaos.

In Nova Scotia, where logic dictates investment from anywhere is a good thing, the government has just hammered the real estate market with a double-edged attack on non-locals. People who buy a seasonal, part-time or investment property will have to pay a 5% tax on the value of it, and then fork over a special 2% annual property tax premium. On a million-dollar place (now a common price) that’s $50,000 upfront on closing, then $20,000 a year forever. Ouch.

Meanwhile in Vancouver the ‘empty house’ tax rate has been tripled, seriously impacting people with pied-à-terres, vacation condos and second homes. The same is on tap for Toronto with a vacancy tax which will, starting in 2023, penalize those with pieces of real estate the city thinks are not being occupied enough.

And next Thursday the Trudeau-Singh party will drop a budget expected to contain its own set of anti-real estate measures. That could include yet another national tax on non-resident buyers along with measures to whack investors, such as a requirement for 35% down payments on rental properties and a ban on using HELOC, loan or gift money in a transaction. Additionally the feds have said they will attack REITs which provide a pool of rental housing. And Re/Max even came out with a piece this week suggesting the capital gains tax exemption on residential real estate may be in play.

In summary, kids, listings are going up and activity is going down. Mortgage increases have only really started. And the people who run the place are determined to distort, twist and alter the market, mistakenly believing things become cheaper when taxed extra. But usually they just get more screwed up.

Owners probably have a week or two left to list, sell and reap. We’re not out of greater fools yet. Don’t feel bad when you nab one. They were warned.

About the picture: “Hello Garth, from Merrie (we wish) England where we, too, have a crop of politicians apparently intent on crashing the economy; borrowing more and more money to try to repeal the laws of gravity,” writes Mark. “I’ve been reading your blog since I chanced upon it in 2014.  It’s interesting to see a commentary from another country we’ve shared much with over a long period of time, even though these days we’re growing apart.  The Daily Dog is an added bonus, so I’d like to introduce you to Polly who’s shared our lives for 15 months and is repairing the hole left by the passing of our last dog.  Polly is three parts Staffordshire Bull Terrier, one part English Bull Terrier.  She was a breeding bitch at a puppy farm before being rescued by a rehoming charity.  When we got her she was 5 1/2 kg (25%) underweight and had several medical issues including being pregnant (which neither we nor the charity knew at first – the singleton puppy didn’t survive).  She’d been badly beaten, knew nothing of play or training, and was scared of her own shadow.

“Fast forward 15 months and she’s a beaut.  Beautiful orangey / chestnut eyes.  Gentle, loving, the picture of health and growing in confidence daily.  She’s learned to be a dog – loves nothing better than a gallop round fields with her 40kg buddy Rufus.  Followed by a good sleep! Proof positive that recovery from a bad place is possible.  Hopefully, that extends to economies, too.”
.

140 comments ↓

#1 Søren Angst on 03.30.22 at 3:49 pm

Gollum. Precious.

Sméagol. Home.

Can it be?

#2 pPrasseur on 03.30.22 at 3:50 pm

“FOOP”! Really???

Solid informative post today.

The bubble mentality would need to be rock solid to withstand all this stuff along rising rates.

I wouldn’t be surprised to see all hell breaks loose and then some major backtracking in about a year from now…

Meanwhile my own province of Québec says welcome to all grumpy speculators and money launderers, as to show some things never change…

#3 Bring It On on 03.30.22 at 3:51 pm

Canadian houses should no longer be exempt from capital gains tax. This could be done on a sliding scale depending on how many years one has owned their home, but it should be implemented in order to put a sizeable dent in the national debt, and bring the housing market back to reality.

Bring it on.

#4 Gen 2010 on 03.30.22 at 3:52 pm

Doug Ford has finally done something great for once. Take that Toronto! Toronto is the city where NIMBYs thrive.

#5 Søren Angst on 03.30.22 at 4:02 pm

Labor of Love.

Nicely done with the dog Mark. Indeed.

PS:

We can lend you Draghi for awhile but you have to keep Boris.

Scusi.

#6 Brett in Calgary on 03.30.22 at 4:02 pm

Buckle up, it’s finally here.

#7 espressobob on 03.30.22 at 4:05 pm

Sticky fingers refers to a certain practice.

Well, let’s just say the Rolling Stones cashed in on that album.

#8 Linda on 03.30.22 at 4:06 pm

So nice to know ‘Polly’ had a happy ending:) She looks like a very intelligent dog.

Given the insane RE prices I have to believe that at least some of the market cooling off is/was due to prices being beyond the reach of most. The pool of buyers who could pay $2 million plus for a place had to be limited in size. If the RE gasbag goes ‘Pop!’ the usual human reaction to prices dropping will likely mirror those who won’t buy when the stock market plummets. Instead they’ll keep waiting for prices to drop more so they can pay as little as possible. At least, that’s what they’ll say they are doing!

As for governments imposing new taxes, well duh. They’ve all spent oodles & must now find ways to get more revenues. Housing frankly looks like the only cash cow readily available to milk. They can pile on the levies all in the name of creating housing ‘affordability’, to the cheers of those who don’t own & who think they will be able to buy at a bargain as owners try to sell. And just like everyone who doesn’t think about consequences, suddenly are faced with having to pay all those fees/levies in turn. Much wailing will result I’m sure. Especially if said fees/levies result in housing being even less affordable which it most certainly will do.

I also wonder what the possible outcome will be for renters come the government intervention. Somehow I don’t think it will result in lower rents for those who can’t afford to buy or who choose not to. Like other business expenses, those new levies/fees will be passed on to the customer at some point.

#9 None on 03.30.22 at 4:07 pm

Jeez garth. Choose a side.

The too little too late argument I get. This housing thing is the ultimate of political incompetence by everyone federal and provincial party and the global RE market.

This all could be avoided but things must change and as a consequence some will be financially ruined.

The two options are:
1) Pull the band-aid and destroy some people who took on too much risk because they’re either greedy or dumb, or;
2) Do the slow melt bail-out where most of the greedy and dumb still get financial windfalls and the responsible bail them out for the next decade.

I prefer option 1.

#10 jerry on 03.30.22 at 4:08 pm

Should you aggressively pay down mortgage in a raising rate environment or invest excess in other investments as rates goes up?

#11 Freedom First on 03.30.22 at 4:10 pm

When it comes to RE, the name of the game is “Take Away”. As many consumers as possible are roped into buying a home, then when enough have bought in, things change to everything, the music stops, and many people are forced into bankruptcy, and have their home “taken away”.

Garth has explained everything you need to know to keep yourself safe. I sincerely hope you listened to him. This is the #1 Canadian Financial Blog for a reason. Describes how to grow, and protect yourself financially over a lifetime, in vivid detail.

#12 T-Man on 03.30.22 at 4:12 pm

A full scale attack on Canadian home prices sounds very UNDEMOCRATIC to me. For a problem created by Gubmint itself. So now they penalize the people for what they themselves have caused. Sounds fair…NOT!!! They say sociopaths are attracted to power and Gubmint is the ultimate power. Sociopaths/Psychopaths are also well represented in corporate boardrooms. These are the people some here admire and worship. Sad.

#13 IHCTD9 on 03.30.22 at 4:17 pm

Wow, Polly is one good looking doggie. That’s from a Cat guy.

#14 AM in MN on 03.30.22 at 4:19 pm

The capital gains tax exemption WILL be in play. If not this year, some time soon. It is the only pool of wealth they can confiscate without the ability of the owner to move it or protect it or somehow change their behavior to avoid it.

The downdrift will last many years. Too much printed money chasing too few lenders means higher rates until the real economy and exports catch up to the money supply.

Enjoy the public sector strikes while watching your net worth evaporate! Keep voting LNDP, you’re a good person!

#15 Homeowner on 03.30.22 at 4:20 pm

Wow, lots of new rules and taxes . Many jobs will be developed to maneuver through the web of red tape.
As for tax on capital gain of primary residence..try it .it would be a death sentence for any government. Can you imagine the next election. A puppy could get ejected on a platform of simply cancelling the tax.

#16 TurnerNation on 03.30.22 at 4:23 pm

Welcome to the global ‘climate agenda’ being rolled out in each Former First World Country.
This is why in 2020 were were trained on #stayhome and “Essential vs Non Essential”.
For the planned rationing and shortages. Comrade there is WW3 now on. Supply lines are being cut.

https://www.bbc.com/news/business-60925016
“Germany and Austria take step towards gas rationing”


— Remember, all famines are man-made. See how our elite rulers mock us so. Serfdom is here, the New System. Energy-poverty. Back to normal any time now!! Soon.

https://www.zerohedge.com/political/wear-warmer-sweaters-government-minister-advice-germans-coping-soaring-energy-costs
Baden-Württemberg Minister of Agriculture and Consumer Protection Peter Hauk made the comments as he called for a complete ban on German imports of Russian gas and oil as a result of the war in Ukraine.
That would devastate Germany’s economy and lead to even higher energy prices given the country’s dependence on Russia…
With Germans already struggling to heat their homes, Hauk glibly told them to wear more clothing instead.
“You can withstand 15 degrees [Celsius] in winter in a sweater. No one dies of it. But people are dying elsewhere,” he said.

— This must be kept going and going. Contracts have been signed by governments. The Long Game. Get to know it.

.Ontario has entered the sixth COVID-19 wave, doctors say (cbc.ca)

#17 Mortgage guy on 03.30.22 at 4:23 pm

How would a tax on a principal residence affect the reverse mortgage world. Very complicated.

#18 IHCTD9 on 03.30.22 at 4:24 pm

#132 Mattl on 03.30.22 at 2:12 pm
#97 IHCTD9 on 03.30.22 at 9:38 am
#84 Ponzius Pilatus on 03.29.22 at 10:49 pm

American made cars are junk.
____

I beg to differ. My two 3/4 ton GMC’s are 19 and 31 years old, and in perfect running condition.

I think the ’91 C2500 has a decade of use still in it -easy. I bought it from the estate of the original owner last year if you can believe it. The owner died before the truck did.

———————————————————–

Yup, drive a 1998 12V Quad Cab, has 365K on the clock and will go for another 700K. Transmissions are suspect but a rebuild every 250K and you are GTG.

Oh, and it tows 10K pounds and gets 24MPG unloaded.
———

Those 12V’s run forever. Yours must be an auto? When it blows, swap to an NV4500, problem solved :)

My C2500 has the weak 6.2 Detroit backed by the mediocre 700R4, but it is likewise great on fuel. The 90’s were a great decade for diesel trucks.

#19 PeterfromCalgary on 03.30.22 at 4:29 pm

Governments pumped too much money out due to the pandemic. Now that money is losing value they have to withdraw that stimulus by raising rates and selling securities they bought (quantitative easing).

The fact that the Liberals recently made a deal with the NDP likely means more fiscal stimulus such as the government paying to fix rotten teeth. When government pays for stuff you use to have to spend your own money on you have more money to inflate the cost of other stuff. Therefore, inflation fighting will only have one tool to use higher interest rates.

Bye Bye low interest rates you were fun for a while but the hangover will suck!

#20 Rach on 03.30.22 at 4:29 pm

How much you want to bet they will introduce the 30 year amortization??
That’s what NDP suggested back in August…

#21 BB on 03.30.22 at 4:30 pm

Am I glad I sold in Ontario and downsized in Calgary, living mortgage free. Thank you Garth! I convinced my parents the same just a month ago and they sold at the peak!

#22 Philco on 03.30.22 at 4:30 pm

#3 Bring It On on 03.30.22 at 3:51 pm
Canadian houses should no longer be exempt from capital gains tax. This could be done on a sliding scale depending on how many years one has owned their home, but it should be implemented in order to put a sizeable dent in the national debt, and bring the housing market back to reality.

Bring it on.
===================
Change the rules because its not working out for you?
Home owners owners didn’t create the national debt or cause the unintended consequence’s of stupid gov policies.
Capital gains brings on other issues.

Their floating “tax unrealized gains on market investments” in the US.
Gov’s are monkey see monkey do. They go we go.
Free markets work the best. That ship has sailed.
Its started way back with ZIRP and monetizing debt along with some other awesome jiggy fixes.
Do a little more in-depth study pls….

#23 Tim on 03.30.22 at 4:31 pm

In Vancouver and Victoria and other parts of Vancouver Island, I still see selling prices that were 40 percent higher than their 2019 assessments. I wonder if people are actually paying these prices or if this is just wishful or delusional thinking on behalf of greedy sellers.

#24 Richard L on 03.30.22 at 4:32 pm

A friend who I would consider a ‘specuvestor’ told me today that he is selling one of his residential properties.

It starts.

#25 TurnerNation on 03.30.22 at 4:33 pm

First they came for the investment properties, then they come for our homes?
Fiction or part of the “You will own nothing and be happy” push?
Such a co-incidence of all these provinces acting at once, in tandem. Wars are fought over land and we are being kicked slowly off ours during this WW3.

-This is why the push. And your first hint was that new Condo construction never got shut down during the Economic Shutdowns in 2020. Learn how the Long Game is played lads.

https://www.centuryinitiative.ca/why-100m
“Growing our population to 100 million by 2100 would reduce the burden on government revenues to fund health care, old age security, and other services. It would also mean more skilled workers, innovation, and dynamism in the Canadian economy. 100 million by 2100 is not just a number. It’s a vision for the Canada we want to build for future generations.”

#26 IHCTD9 on 03.30.22 at 4:33 pm

“…with measures to whack investors, such as a requirement for 35% down payments on rental properties and a ban on using HELOC, loan or gift money in a transaction.”
——-

This is almost all we need right here. Rigidly enforced. Add in CGT on PR’s (with a slide to zero over say, 5 years), and the great Canadian RE bubble is over. Just like that.

#27 Lloyd on 03.30.22 at 4:34 pm

Garth, you’ve routinely criticized any blog dogs who merely suggested that foreigners are at least partially to blame for runaway house prices. Now you’ve described the Ford government’s increase of the foreign buyer’s tax to 20% as a “death blow”. Pick a side.

I said it was “a death blow to certain market segments.” Did you miss the last four words? Spend a little more time reading. – Garth

#28 IHCTD9 on 03.30.22 at 4:47 pm

#3 Bring It On on 03.30.22 at 3:51 pm
Canadian houses should no longer be exempt from capital gains tax. This could be done on a sliding scale depending on how many years one has owned their home, but it should be implemented in order to put a sizeable dent in the national debt, and bring the housing market back to reality.

Bring it on.
————

Yes bring it (sliding scale), but not to pay off Trudeau’s debt, but to stop folks from running a business income tax free. I know people living in their 13th house.

#29 Lloyd on 03.30.22 at 4:49 pm

Garth, you’ve routinely criticized any blog dogs who merely suggested that foreigners are at least partially to blame for runaway house prices. Now you’ve described the Ford government’s increase of the foreign buyer’s tax to 20% as a “death blow”. Pick a side.

I said it was “a death blow to certain market segments.” Did you miss the last four words? Spend a little more time reading. – Garth

I read it just fine the first time. It’s a vague statement. Which certain market segments? And how are they so detached from the housing market as a whole? Spend a little more time being precise with your words. And yes, I haven’t forgotten that this is a free blog.

Clearly the segments which have attracted offshore money are not ‘detached from the market as a whole.’ But they not make the market. That is precisely the point. The market is far from homogenous and every little cut has an impact. Lose the attitude. – Garth

#30 Grandv!ew on 03.30.22 at 4:51 pm

Impressive list of taxes and measures that up until now did not do much in order to change the fact that our real estate is overpriced and threatening the financial stability of our country. Maybe there was/is a way to prolong the party while holding the nose and pretend its all normal. But it looks like we are at the end of that road. I feel that pulling the levers of financial system and in order to achieve prolonged life of the bubble we arrived, and crossed the Rubicon. Most likely there is no going back now. Combination of inflation, raising rates(recession?) and crazy Putin’s war + everything else said in the column above is scary and it could have been avoided if we did not place all the economy eggs into single(real estate) basket. Maybe just like corrections in financial markets, correction in real estate (once we are on the other side of it) will be better for our economy and country. If the correction doesn’t kill us (and it should not and it wont) we will become more stable, cohesive and resilient for any potential future shocks. Not to mention we will become more competitive for talent and investment from future looking industries.

I always wondered why are houses so much more expensive in Canada vs. USA. All of the common explanations (Trump, Republicans, Democrats, Health Care, Guns, School System……insert here any reason you can think of) somehow do not add up to account for such a large difference in values. What if our real estate values revert to the mean representative of USA values? Is that too hard to believe? As Garth used to say in the past: Canadians always think with real estate it is different here and different this time. Somehow it is much harder to believe in that statement right now.

#31 T-Man on 03.30.22 at 4:53 pm

On Tuesday, BlackRock Inc. President Rob Kapito said :
“For the first time, this generation is going to go into a store and not be able to get what they want.” “And we have a very entitled generation that has never had to sacrifice.” Here’s THE BIGGEST ENTITLED pompous ass speaking to us little people. His HIGHNESS also quipped :
Americans who don’t want to pay $ 10 a gallon for gas or not be able to feed their families “entitled. ” Meet the parasites who REALLY run the western demonocracies.

#32 SW on 03.30.22 at 4:54 pm

As a matter of people with “sticky fingers” which actually means robbers or thieves in British idiom.

I’ve been using the Wise platform to transfer smallish amounts of money CANUKP for family reasons.
A good experience when it goes well. When there’s an issue, customer support is a lot less than optimal.
I may be out a hundred bucks or so, after a month of complaining, back and forth. A lesson learned.

I wouldn’t recommend it for large amounts…

#33 sailed away on 03.30.22 at 4:55 pm

Would a person from abroad still be able to buy a property using a Canadian company with nominee directors, exotic shareholding or maybe another pass through entity and avoid these taxes targeting foreigners?

Asking for a friend (sarcasm)

#34 T-Man on 03.30.22 at 5:01 pm

DELETED

#35 Cici on 03.30.22 at 5:03 pm

Fell off the blog post again but I’m back to the future. This was supposed to be here:

“The government wants higher densities along with rezoning of peaceful, leafy, expensive hoods to allow multi-unit structures.”
_____________________________________________

This is the #1 reason why I’m afraid to buy. The peaceful, leafy and expensive hood I’m currently renting in has literally been destroyed in the last few years I’ve been here, to the point I went to get the heck out ASAP.

In the last year, they’ve put up three huge condo towers in what once was a residential area safe for children, but now just crossing the street is a death wish and even more condo towers are coming down the pipeline. Soon, there will be more huge, ugly new builds than single family homes in this area, which doesn’t have the roads or other infrastructure to safely support all this excessive new development.

As a proud N.I.M.B.Y, I’m feeling squeezed out and contemplating an eventual move to the Far North but maybe in the opposite direction or even beyond the border. In the meantime, while waiting to see how it all pans out, I’ll continue to rent for the mobility.

#36 IHCTD9 on 03.30.22 at 5:03 pm

#17 Mortgage guy on 03.30.22 at 4:23 pm
How would a tax on a principal residence affect the reverse mortgage world. Very complicated.
——-

It wouldn’t assuming the homeowners taking out a RM lived in the house long enough to become CGT exempt.

#37 THE DANDADA on 03.30.22 at 5:08 pm

Here’s the problem now……. RENT

IT’s OUT OF CONTROL!!

Landlords are now pushing would be renters to buy at whatever cost. The gap has closed significantly making renting not worth it at all.

#38 neo on 03.30.22 at 5:09 pm

I have been thinking of knocking out a mobile app that lists the 1.3 million empty houses in Canada along with map location and driving directions to find them. Why not just squat if you are having difficulty finding affordable housing.

Chances are the owners are living in China or Russia so you could likely live there for years before anyone noticed you were there.

If enough people use the app there is no way the criminal government could keep up with evictions.

Is there a data set already for these houses? Its could be crowd sourced if needed.

There is a list of Heritage buildings in Vancouver.

https://vancouver.ca/home-property-development/find-a-registered-heritage-building-site-or-tree.aspx

Keep an eye out on the App Store. SquatSquad sounds like a good app name.

#39 Cici on 03.30.22 at 5:09 pm

Polly is absolutely gorgeous, Mark. Thanks for sharing her story and for taking her in and offering her such a great home!

#40 Lumber on 03.30.22 at 5:11 pm

A few months ago I renewed my mortgage early, 10yr @2.67%. Felt pricey at the time, but I’m glad now

#41 uncle dave on 03.30.22 at 5:14 pm

This may have been answered but what does this mean for the REIT portion of a B&D portfolio?

#42 Sail Away on 03.30.22 at 5:15 pm

We bought our first house in Alaska in 2001 for $179k. Our salaries were then around $60k USD each, so the house cost 150% annual household salary. We loved that house.

Moving to Canada in 2006, we sold the house for $240k and the average Nanaimo house cost about the same. Our Canadian salaries were around $80k CAD each, so houses cost around 150% our household salary.

Now, the average Nanaimo house is $1m. Correlating this to an average P.Eng. salary of $110k or $220k per family, yields a house 450% more than household salary.

If houses had cost that much when we were considering relocation here, that would have immediately shut down the move. With the many, many desirable US areas where houses are 150% professional household income, it would be silly for rationally intelligent people to relocate into RE goofiness.

We’re encouraging our kids to find jobs in the US. Then we can gift them a couple hundred thousand to buy a place and they can put all effort toward advancing their careers.

It’s just a house. Nothing special. Overpaying is silly.

#43 Linda on 03.30.22 at 5:17 pm

About the Ontario? governments plan to ‘rip away red tape & expedite the construction of 1.5 million new housing units’. Given that the for profit construction industry is churning out about 41,000 new housing units per annum, 75% of which is new apartments, don’t quite see how a bill to expedite the construction of 1.5 million new units is realistic. What is the time frame here? A decade? More? Seriously, why do governments even bother to publish such unrealistic numbers? There simply isn’t the land, materials, labor, equipment & most important from the industry point of view the buyers available. All the land transfer taxes etc. by themselves will put the price per unit well out of reach of the lower end of the income scale. When the price per square foot is north of $1,000 per foot, even a micro unit is one pricey purchase. Actual space? Beyond most people’s means without epic debt, at least in the GTA & YVR areas.

#44 Mark on 03.30.22 at 5:19 pm

#33 sailed away

Would a person from abroad still be able to buy a property using a Canadian company with nominee directors, exotic shareholding or maybe another pass through entity and avoid these taxes targeting foreigners?

Asking for a friend (sarcasm)

———————-
Fear not, fellow beaver, for the number of times that such legislation has been drafted and passed without sufficient loopholes as to not disturb the top echelons of society is precisely zero. Tell your friend (s)he can sleep well.

#45 Bring It On on 03.30.22 at 5:27 pm

#30 Grandv!ew on 03.30.22 at 4:51 pm

“I always wondered why are houses so much more expensive in Canada vs. USA. All of the common explanations (Trump, Republicans, Democrats, Health Care, Guns, School System……insert here any reason you can think of) somehow do not add up to account for such a large difference in values. What if our real estate values revert to the mean representative of USA values? Is that too hard to believe? As Garth used to say in the past: Canadians always think with real estate it is different here and different this time. Somehow it is much harder to believe in that statement right now.”

————————

Americans pay capital gains tax on the sale of their principle residences.

#46 Big Bucks on 03.30.22 at 5:37 pm

A 2% tax on principle residences wouldn’t really surprise anyone would it?2% in 2022 and when we hit the debt wall in 2025(the NDP’s fault of course–according to Libs)they will raise it to 5%.By 2030 it will be up to 10% and so on and so forth…

#47 Bezengy on 03.30.22 at 5:43 pm

Winners and Losers.

Property is red hot here in Northern Ontario. I see two types of buyers.

One is the Mennonites. They are seeking more farmland for their growing population. They will carefully seek out farmland paying up to $1500 per acre. They are well funded and if they find something they can buy they’ll bring in heavy equipment and a team of 30 men and women to prepare the land for crops. In a short 2-5 years after working like madmen they’ll have raised a barn and grow their own food, and be in a position in sell what the farm produces.

Two are the Torontonians. They will buy sight unseen for $3000 per acre. They’ll tow a used trailer to the site and get someone local to drag it through the swamp to their new found paradise and spend a weekend or two drinking some beers, and maybe plant a few marijuana plants. Then they’ll head back to the city, or worse try to survive a winter, but it won’t work out, and end badly. Their garbage will remain on site until the next fool decides to give it a go.

#48 WTF on 03.30.22 at 5:43 pm

Friends 20 something Daughter and SIL just sold their townhouse in Langley. Got the Cheque yesterday, over 300k for 3 years ownership. Now renting, Have a larger place more suitable for their growing familyand 1k less a month than their ownership cost. Investing the windfall. Some smart kids out there.

#49 Shawn on 03.30.22 at 5:44 pm

Nova Scotia?

In Nova Scotia, where logic dictates investment from anywhere is a good thing, the government has just hammered the real estate market with a double-edged attack on non-locals. People who buy a seasonal, part-time or investment property will have to pay a 5% tax on the value of it, and then fork over a special 2% annual property tax premium. On a million-dollar place (now a common price) that’s $50,000 upfront on closing, then $20,000 a year forever. Ouch.

********************************
Nova Scotia has a lot of problems. The population is older than the Canadian average. They can’t keep up with the medical costs.

Many people there collect government cheques and don’t want anything to change.

I was born and raised and educated there. I came to Alberta for work in 1989. I retain many ties and family in Nova Scotia.

I have watched with disappointment for 33 years now as the people of Nova Scotia “ran off” development proposals one after the other.

Now they need immigration but instead are more so walling the place off to outsiders.

Halifax continues to do pretty well economically. Most of the rest of the province, not so much.

I have no sympathy. They reap what they sow.

#50 Dr V on 03.30.22 at 5:49 pm

12 T-man

“Sociopaths/Psychopaths are also well represented in
corporate boardrooms. These are the people some here
admire and worship. Sad.”
——————————————-

Certain psychopathic traits can be good.

“When most of us hear the word ‘psychopath,’ we imagine Hannibal Lecter. Kevin Dutton would prefer that we think of brain surgeons, CEOs and Buddhist monks. In his new book, The Wisdom of Psychopaths: What Saints, Spies and Serial Killers Can Teach Us About Success, the Oxford research psychologist argues that psychopathic personality traits—charm, confidence, ruthlessness, coolness under pressure—can, in the right doses, be a good thing. Not all psychopaths are violent, he says, and some of them are just the sort of people society can count on in a crisis.”

https://www.smithsonianmag.com/science-nature/the-pros-to-being-a-psychopath-96723962/

I recall these traits are often present in trial lawyers, ER doctors, military leaders.

#51 COVID Variant Math on 03.30.22 at 5:57 pm

And people thought all that COVID/CERB-ian money was free.

What’s the most expensive thing in the world?

Yup. Free stuff from the government.

#52 Senator Bluto on 03.30.22 at 5:59 pm

#33 sailed away on 03.30.22 at 4:55 pm
Would a person from abroad still be able to buy a property using a Canadian company with nominee directors, exotic shareholding or maybe another pass through entity and avoid these taxes targeting foreigners?

Asking for a friend (sarcasm)

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

Da, Komrade! As long as you give great many rubles to Liberal Party, all is OK.

#53 Stone on 03.30.22 at 6:00 pm

#17 Mortgage guy on 03.30.22 at 4:23 pm
How would a tax on a principal residence affect the reverse mortgage world. Very complicated.

———

No. It’s actually really simple. It doesn’t matter what kind of mortgage you have. If there’s a capital gain at the sale of the property and it’s taxable, the owner of said property has to pay the capital gains tax. Period!

Why would you think it would be complicated? Taxes don’t cater to the taxpayer. They cater to the gouvernment that implements the tax.

#54 Stone on 03.30.22 at 6:01 pm

#21 BB on 03.30.22 at 4:30 pm
Am I glad I sold in Ontario and downsized in Calgary, living mortgage free. Thank you Garth! I convinced my parents the same just a month ago and they sold at the peak!

———

Well done.

#55 Yay on 03.30.22 at 6:14 pm

So GT, if I’m understanding you correctly, all this happening because rates are not really supposed to go up?

No, you do not understand correctly. – Garth

#56 kman on 03.30.22 at 6:23 pm

Isn’t that 2% on the value of the tax?
So a $4000/year tax turns into a $4800 tax?

On assessed value. – Garth

#57 Sail Away on 03.30.22 at 6:24 pm

#45 Bring It On on 03.30.22 at 5:27 pm

Americans pay capital gains tax on the sale of their principle residences.

———

To some degree, yes. As follows:

https://www.investopedia.com/ask/answers/06/capitalgainhomesale.asp

‘KEY TAKEAWAYS

1. You can sell your primary residence and be exempt from capital gains taxes on the first $250,000 if you are single and $500,000 if married filing jointly.

2. This exemption is only allowable once every two years.

3. You can add your cost basis and costs of any improvements that you made to the home to the $250,000 if single or $500,000 if married filing jointly.’

#58 Dr V on 03.30.22 at 6:26 pm

45 Bring it on

“Americans pay capital gains tax on the sale of their
principle residences.”
———————————————————-

Well, on some of the gain under certain conditions, and
they can adjust their cost base as well. Good primer here:

https://www.investopedia.com/ask/answers/06/capitalgainhomesale.asp

#59 under the radar on 03.30.22 at 6:29 pm

33 Concealing beneficial ownership to avoid foreign resident tax is fraud . In Ontario, you must answer if there are other persons or Corporations who have a beneficial interest in the property being purchased and if there are foreign shareholders etc.

53 – It’s complicated because any new tax would throw out the projections on loan to value ratios and remaining balances, meaning maximums will be lowered to account for the tax.

#60 Downward Slope on 03.30.22 at 6:29 pm

If housing equates to 15-20% of GDP in Canada then how can a housing slowdown (stall) not lead to a recession?
Never mind the high fuel costs and food inflation.
Sell in May and go away I say.

#61 Dr V on 03.30.22 at 6:29 pm

Dang – Sailo at 57 stole it!

BUT HE MISSED PRINCIPLE!!!

Mwahaha…

#62 Shawn on 03.30.22 at 6:39 pm

2% on Assessed Value to be added for foreign owners in Nova Scotia.

#56 kman on 03.30.22 at 6:23 pm

Isn’t that 2% on the value of the tax?
So a $4000/year tax turns into a $4800 tax?

On assessed value. – Garth

********************
Also kman, get a new calculator, one that does not give $800 as the answer to what is 2% of $4000?

#63 Downward Slope on 03.30.22 at 6:42 pm

Realtors and observers say this is beyond dumb. It would allow buyers to tie up multiple properties with no intention of actually closing ny deal and no real financial incentive to do so.=GT

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

It has also been recommended that there be a financial penalty for backing out of a deal, to try to prevent any shenanigans on the buyer’s part.

#64 Observer on 03.30.22 at 7:04 pm

#30 Grandview

” I always wondered why are houses so much more expensive in Canada vs. USA. All of the common explanations (Trump, Republicans, Democrats, Health Care, Guns, School System……insert here any reason you can think of) somehow do not add up to account for such a large difference in values.”

^^^^^^^^^^^^^^
USA has capital gains tax for gains over 250K per person (per lifetime I think). This likely is one factor, among others, that makes Canadian housing more attractive as an investment and thus more expensive.

#65 Adam on 03.30.22 at 7:08 pm

So real estate down, stocks up?

Canadian real estate faltering. Financial assets reflecting the re-opening trade and higher commodity values. As explained. – Garth

#66 Sam on 03.30.22 at 7:15 pm

Haha full attack housing take 6!! This is all nonsense. For show. If they wanted to tackle housing they would’ve raised rates and stopped printing money. That’s the only way to end this mess

#67 Cowtown Cowboy on 03.30.22 at 7:19 pm

Well no real surprise when you vote in socialists…a mere 6 or so years and this country is pretty much unrecognizable..reap what you sow ON and BC

#68 yvr_lurker on 03.30.22 at 7:19 pm

I am generally supportive of very high taxes on the purchase of Canadian residential real estate by foreigners (defined as those without PR status or citizenship). The ban should be across the board: individuals, numbered companies, and on other ways to hide the true ownership of residential units. I have no problem with this. Leave the Principal Residence exemption intact, but increase taxes on local speculators who make a living by buying and flipping properties. Not in a punitive way (because we do not people willing to buy and restore old houses), but in a way that takes some of the excessive profit out of this activity, which further erodes affordability.

#69 yvr_lurker on 03.30.22 at 7:21 pm

typing too fast: correction

Not in a punitive way (because we do NEED people willing to buy and restore old houses for EVENTUAL resale), but in a way that takes some of the excessive profit out of this activity…

#70 Sail Away on 03.30.22 at 7:22 pm

#50 Dr V on 03.30.22 at 5:49 pm

Certain psychopathic traits can be good.

——–

I personally get along, and work, very well with those who can focus on isolating and solving the actual problem at hand instead of getting all emotionally wound up with irrelevancies. Unnecessary tangents reduce profitability and also result in terrible investing decisions.

More of these, please. Submit resumes. 5am wakeup viewed favourably.

#71 Quintilian on 03.30.22 at 7:41 pm

#8 Linda on 03.30.22 at 4:06 pm
“Like other business expenses, those new levies/fees will be passed on to the customer at some point.”

“Like other business”:

You start with a false assumption, and you end with erroneous results.

The viability and success of a business, is based on delivering a service or a product. The value of an enterprise increases because it produces more with the same assets, therefore higher valuations are achieved by hard work, innovation and efficiency.

Somebody buys a house with a basement suite and while they sleep it goes up in value more than the owner earns by working, and the rent goes up exponentially without giving the renter more space or quality.

The increase in price is inflation, and or a distortion in valuation, or a price mismatch in terms used in commerce.

Theft from the next generation, unearned and undeserved wealth are terms I would use in Judeo Christian terms.

#72 Memememe on 03.30.22 at 7:53 pm

So, are we to dump the REITS from our portfolios?

Of course not. – Garth

#73 Sail Away on 03.30.22 at 8:06 pm

#61 Dr V on 03.30.22 at 6:29 pm
Dang – Sailo at 57 stole it!

BUT HE MISSED PRINCIPLE!!!

——–

Haha

#74 Barb on 03.30.22 at 8:23 pm

Thank you, Mark, for giving Polly a safe and happy home where she has learned to trust again. Such a sad beginning.

Canada is now a one-party country, entirely devoid of any viable opposition. Meddlesome and inept socialist bureaucrats’ hands are all over these knee-jerk federal and provincial plans. T2 has a few more years to destroy what generations have built with sweat and a strong work ethic.

“…the feds have said they will attack REITs which provide a pool of rental housing.” This from the new CPP, the Counter-Productive Party.

Idiots, total idiots.

#75 Christopher Mewhort, EA on 03.30.22 at 8:27 pm

64 USA has capital gains tax for gains over 250K per person (per lifetime I think). This likely is one factor, among others, that makes Canadian housing more attractive as an investment and thus more expensive.
————————-
Please keep your day job and try to refrain from giving US taxation advice. Please!

Christopher Mewhort, EA
519-525-7277

#76 Midnight’s on 03.30.22 at 8:38 pm

Canadian houses should no longer be exempt from capital gains tax. This could be done on a sliding scale depending on how many years one has owned their home, but it should be implemented in order to put a sizeable dent in the national debt, and bring the housing market back to reality.

Bring it on

Yeah that’s it. As I pay it down home and move. Keeping the older home(s) and renting it and buying my new home.
Never triggering a capital gain keeping the capital appreciation and increases in rent it’s like printing money. Read more talk less.

#77 Ponzius Pilatus on 03.30.22 at 8:41 pm

CEF,
Regular gas is 1.90 in the Sunny Surey.
IHTD9.
Diesel is about 30 cents more expensive than regular per litre right now?
So, filling up the DuraMax at 120 litres would cost you about 30 bucks more than a gas F-150.
Lets extrapolate over a year
30cents x 120 x 54 = about 2k more than you would pay for a regular gas F-150.
And you worry about the cost of insurance. 640 bucks.

#78 Ponzius Pilatus on 03.30.22 at 8:44 pm

112 Sail Away on 03.30.22 at 11:27 am
#82 crowdedelevatorfartz on 03.29.22 at 10:35 pm
@#123 Lorne

“Strangely enough, with good management, ICBC is thriving and is able to return some of the $ you paid for your insurance. ”

——–

Only Horgie Porgie and Queen Christie know for sure since we don’t get to see the real numbers.

——–

Well… yeah. That’s the way monopolies work. Not profitable? Raise prices. It’s not like there’s any other option for the captive consumer.

Best business model ever.
—————————-
Monopolies.
That’s what the endgame in unfettered Capitalism is.
Look at Apple.
Charge you 1k for a poduct that costs 50 bucks to make.
You know how high the mark-ups on glasses and hearing aids are?
Insane.
I know they are talking about competition.
Where is Apple’s competition?
The minute one shows up, Apple buys them up for a pittance.
Well, but the share holders are happy.

#79 Janice on 03.30.22 at 8:49 pm

Polly is sooooo Beautiful!! What an amazingly sad yet happy story! I imagine she is living a wonderful life now!! I want a Polly!!!!! Good on you Mark!

#80 Flop… on 03.30.22 at 9:04 pm

“But when prices falter people are hit with FOOP – Fear of Over-Paying. Buyers back off, afraid houses will be worth less soon.”

FOOP is ok.

Fear of Losses, Overly Precautious.

FLOP.

Has a certain ring to it…

M47BC

#81 Ponzius Pilatus on 03.30.22 at 9:07 pm

DELETED

#82 neptunian on 03.30.22 at 9:24 pm

seller’s FOMO (fear of missing out of selling high) will have much bigger impacts to RE bubble burst than buyer’s FOOP (fear of over paid). the question is what will trigger that FOMO. rates still not high enough. will those silly government policies trigger it? we will see.

#83 morry on 03.30.22 at 9:34 pm

There Will Be Blood.

#84 toronto1 on 03.30.22 at 9:35 pm

Make no mistale, the bearded dude is right– the changes today are to actually pretty severe.

1. price of land is tied to zoning, thats why the fanciest hoods in the country have the top shelf lawyers fighting any change zoning.. increased density equals more people in an area meaning its less exclsuive…. big change.. its why people fight tooth and nail to keep the green areas zoned as such- dont be fooled by the environmental labels– check who joins the adjoining acerages– hmm there all owned by a few developer families…..hmmm if the neighbouring parcels where no longer considered environmental (green protected) what would that do to their valuations, guess there land wouldn’t be as valuable anymore…i

2. foreign buyers tax Ontario wide– that small pool of offshore money just moved to bunny patch areas after the first tax was raised– these are large urban areas outside of GTA (Ottawa, Kitchener,London etc…) those areas have pricing way out of whack to local incomes and populations and dont have the diversity of employers that Toronto does (exception Ottawa as its a govt center) even if this small pool of investors comprises 5 or 10% of those markets– thats a sizeable chunk that cannot be absorbed by local demand at current valuations…

#85 Andrei on 03.30.22 at 9:37 pm

Taxes only reduce the supply of real estate by diverting some of the capital elsewhere. How is this going to solve the real estate problem? As Garth said, describing the politicians’ actions – “suck and blow”.

#86 Moses71 on 03.30.22 at 9:45 pm

What? You mean under Trudeau’s gov’t the far reaching housing price issues are getting dealt with? Nice! And I’m sure there’s more up his sleeve to pay for how he had to help Canadians stay dignified during a pandemic. Good thing Harper isn’t still in power. And the Canadian military couldn’t stand him anyways

#87 45north on 03.30.22 at 10:11 pm

Linda About the Ontario? governments plan to ‘rip away red tape & expedite the construction of 1.5 million new housing units’. Given that the for profit construction industry is churning out about 41,000 new housing units per annum, 75% of which is new apartments, don’t quite see how a bill to expedite the construction of 1.5 million new units is realistic. What is the time frame here? A decade? More? Seriously, why do governments even bother to publish such unrealistic numbers? There simply isn’t the land, materials, labor, equipment & most important from the industry point of view the buyers available. All the land transfer taxes etc. by themselves will put the price per unit well out of reach of the lower end of the income scale. When the price per square foot is north of $1,000 per foot, even a micro unit is one pricey purchase. Actual space? Beyond most people’s means without epic debt, at least in the GTA & YVR areas.

“I don’t see how a bill to expedite the construction of 1.5 million new units is realistic”

it isn’t

“why do governments even bother to publish such unrealistic numbers?”

This is the Ontario Provincial Government. They can point to a problem they’re solving. This is a huge power grab from city government to the Province. They are talking about zoning at the province level. This is naked ambition.

#88 Lorne on 03.30.22 at 10:22 pm

#12 T-Man on 03.30.22 at 4:12 pm
A full scale attack on Canadian home prices sounds very UNDEMOCRATIC to me. For a problem created by Gubmint itself. So now they penalize the people for what they themselves have caused. Sounds fair…NOT!!! They say sociopaths are attracted to power and Gubmint is the ultimate power. Sociopaths/Psychopaths are also well represented in corporate boardrooms. These are the people some here admire and worship. Sad.
……
Gubmint did not force anyone to buy a house. Many have been greedy along the way, including investors and real estate agents who continually pushed up asking prices. Greed often leads to problems…..and many are about to find out about their poor decisions.

#89 Ponzius Pilatus on 03.30.22 at 10:23 pm

DELETED

#90 Hookshott on 03.30.22 at 10:25 pm

#15 Homeowner on 03.30.22 at 4:20 pm
Wow, lots of new rules and taxes . Many jobs will be developed to maneuver through the web of red tape.
As for tax on capital gain of primary residence..try it .it would be a death sentence for any government. Can you imagine the next election. A puppy could get ejected on a platform of simply cancelling the tax.
…….
Sliding scale….tax diminishes by 10% each year so that after owning a house for 10 years you would pay no capital gains. Most would see this as fair….and obviously would discourage speculation.

#91 Ponzius Pilatus on 03.30.22 at 10:26 pm

#83 morry on 03.30.22 at 9:34 pm
There Will Be Blood.
———–
Why did you not delete this post?

Because it refers to a market condition, not a person. You crossed the line. – Garth

#92 Jelly Quan on 03.30.22 at 10:26 pm

These new foreign-non local tax schemes are idiocy from the get go. The problem is and has been record low interest rats for the past decade long borrowing spree by greedy governments. ZIRP has allowed the rampant inflation to fester and turn gangrenous. No amount of penalty will stop buying if money is free. The “foreign buyer” is a straw man, the penultimate red herring. Trudeau will get his half million immigrants going forward, but they will arrive penniless and starving for welfare because no immigration prospect with money and investment potential would choose corrupt Canada in its current state of decomposition. You want to normalize the housing market? Normalize interest rates to the 50 year average which is something like 9%. Cut off government spending by legislation that includes caning. Blaming immigrants foreigners and moms savings is racist and otherwise despicable. As far as the East Coast is concerned, let them be an example to the world of how a group of external phobes inbred and grew flippers.

#93 DON on 03.30.22 at 10:29 pm

#82 neptunian on 03.30.22 at 9:24 pm
seller’s FOMO (fear of missing out of selling high) will have much bigger impacts to RE bubble burst than buyer’s FOOP (fear of over paid). the question is what will trigger that FOMO. rates still not high enough. will those silly government policies trigger it? we will see.

**********

Sentiment changes as prices sky rocket and rates rise. Are rates expected to decline in the next 6 months? The roller coaster goes up and then comes down.

#94 Randall G on 03.30.22 at 10:32 pm

not sure there is a week or 2 left for sellers to reap, check out the new listings in last 7 days in Newmarket……

https://www.realtor.ca/map#LatitudeMax=44.08383&LongitudeMax=-79.41262&LatitudeMin=44.01673&LongitudeMin=-79.50979&view=list&Sort=6-D&PGeoIds=g30_dpz6xg42&GeoName=Newmarket%2C%20ON&PropertyTypeGroupID=1&PropertySearchTypeId=1&TransactionTypeId=2&Currency=CAD

As stated. – Garth

#95 crowdedelevatorfartz on 03.30.22 at 10:48 pm

@#12 Troll-Man
“Sociopaths/Psychopaths are also well represented in corporate boardrooms. These are the people some here admire and worship. Sad.”

+++
Yes, its sad you admire Putin.

#96 Ponzius Pilatus on 03.30.22 at 10:50 pm

Your house.
Your rules.

#97 crowdedelevatorfartz on 03.30.22 at 10:54 pm

@#31 Troll-Man
“Here’s THE BIGGEST ENTITLED pompous ass speaking to us little people.”

+++

I’m quite sure he didn’t rise to the top of Blackrock because he was a “pompous ass”.

Personally. When someone like that is handing out a free opinion on what he thinks is coming in the economy…..ya might wanna take note.

Or let your narrow minded hatred for success blind you.
:)

#98 crowdedelevatorfartz on 03.30.22 at 10:56 pm

@#33 Sail Away
“Would a person from abroad still be able to buy a property using a Canadian company with nominee directors, exotic shareholding or maybe another pass through entity and avoid these taxes targeting foreigners?”

+++
It happens here quite often so I would assume…..yes.

#99 Ustabe on 03.30.22 at 11:02 pm

#74 Barb on 03.30.22 at 8:23 pm

Thank you, Mark, for giving Polly a safe and happy home where she has learned to trust again. Such a sad beginning.

Canada is now a one-party country, entirely devoid of any viable opposition. Meddlesome and inept socialist bureaucrats’ hands are all over these knee-jerk federal and provincial plans. T2 has a few more years to destroy what generations have built with sweat and a strong work ethic.

“…the feds have said they will attack REITs which provide a pool of rental housing.” This from the new CPP, the Counter-Productive Party.

Idiots, total idiots

The bold part certainly isn’t Trudeau’s fault now is it?

Also, back in the day, I was on an industry specific Board of Directors in Victoria. Part of what we did was work with government on aspects of legislation that might impact our industry. We worked with loads of bureaucrats and very few were socialists. Lots of NDP types but nearly matched by by the Socred contingent with a sizable percentage of pure neutral types. To my perhaps imperfect recall.

So, may I offer that if we perhaps were to spend lees time worrying about “socialist bureaucrats” and more worrying about the CCP’s inability to source and champion a leader who can galvanize the party members and bring enough folks over from the squishy middle to actually allow a conservative party to form a government…well, that could be good, no?

#100 Sail Away on 03.30.22 at 11:17 pm

#78 Ponzius Pilatus on 03.30.22 at 8:44 pm

Re: ICBC

Monopolies.
That’s what the endgame in unfettered Capitalism is.

———

Yep, I guess BC’s NDP are unfettered capitalists.

Or did you think someone else was running the province’s ICBC monopoly?

#101 DON on 03.30.22 at 11:26 pm

Dollarama now $5 Dollarama.

#102 NoName on 03.30.22 at 11:45 pm

UK 70% tax on funny stuff, imagine that…

https://imgur.com/a/niNzo6t

#103 Dumb'ster fire on 03.31.22 at 12:13 am

#72 Memememe on 03.30.22 at 7:53 pm
So, are we to dump the REITS from our portfolios?

Please do. The downward pressure will allow me to purchase more shares at even better prices. And just think … you will be able to sleep better at night rather than being tormented day in and day out!

#104 Ponnaps on 03.31.22 at 12:35 am

Considering the impending rate hikes and the full scale attack across multiple levels of govt , would you say housing is now entering crash territory as against suffering a slow melt?

#105 Ponzius Pilatus on 03.31.22 at 12:39 am

100 Sail Away on 03.30.22 at 11:17 pm
#78 Ponzius Pilatus on 03.30.22 at 8:44 pm

Re: ICBC

Monopolies.
That’s what the endgame in unfettered Capitalism is.

———

Yep, I guess BC’s NDP are unfettered capitalists.

Or did you think someone else was running the province’s ICBC monopoly?
———————
I get it.
ICBC – bad monopoly.
De-Beers, Apple, Rockefeller etc, – good monopoly.

#106 T-Man on 03.31.22 at 1:39 am

DELETED

#107 Ponzius Pilatus on 03.31.22 at 1:41 am

The four largest beef packers in North America are facing a possible class-action lawsuit in Québec alleging the companies have colluded to raise the price of beef since 2015.
Option consommateurs, a non-profit consumer organization, filed an application on March 24 to institute the class action against Cargill, Inc., JBS USA Food Company, Tyson Foods Inc. and National Beef Packing Company, alleging they conspired to restrict competition related to the production, supply or sale of beef in Québec.
Members of the class action include anyone who purchased beef in Québec on or after Jan. 1, 2015.
The four companies have a monopoly in the North American beef market, owning 85 per cent of the Canadian market and 80 per cent of the American market, the lawsuit says
————————
See Sailo.
Monopolies come in many forms.
Many people would say that Oil Companies are acting like a Monopoly.

#108 Dr V on 03.31.22 at 1:46 am

99 Ustabe

“Canada is now a one-party country, entirely devoid of
any viable opposition.”

The bold part certainly isn’t Trudeau’s fault now is it?
———————————–

Well, maybe it is a bit. If he was popular enough, he would have a majority government. Instead, he leans left far enough to capture Jag. The Cons implode on their own and presto – no opposition, with less than 1/3
the popular vote.

And my middle is not “squishy”!

#109 under the radar on 03.31.22 at 6:57 am

Ontario has had a 10 day recission period on new condo’s for many years. Buyer can walk during the 10 day period for any reason.

That’s a small slice of the market, on real estate not yet built. Nobody has ever seen the wisdom of extending that to an entire market, province-wide. It may be reckless. – Garth

#110 Leftist on 03.31.22 at 7:18 am

Norway is sucking up oil from their massive off shore fields in record volumes. The Norwegians are having to sell reserves to beat down the value of the local currency. Can you imagine the boom in revenues if Trudeau wasn’t doing everything he can to kill Canada’s energy complex. Keep in mind that you can’t drive to a protest in the North Sea like Hollywood and our government ministers do in the Alberta fields?

UK also breathing life into off shore fields that eco-crazies thought they’d killed. Can you imagine if Trudeau wasn’t killing off Canada’s ability to fund prosperity? Our energy die-off is murderous, especially at times like these when the economy is shrinking noticeably and the wolves are at the door internationally. Has Canada just been too easy a target for the crazies? Why is our enemy Norway ramping up while Canada is being shut down?

#111 IHCTD9 on 03.31.22 at 8:37 am

#77 Ponzius Pilatus on 03.30.22 at 8:41 pm
CEF,
Regular gas is 1.90 in the Sunny Surey.
IHTD9.
Diesel is about 30 cents more expensive than regular per litre right now?
So, filling up the DuraMax at 120 litres would cost you about 30 bucks more than a gas F-150.
Lets extrapolate over a year
30cents x 120 x 54 = about 2k more than you would pay for a regular gas F-150.
And you worry about the cost of insurance. 640 bucks.
________

1991 C2500 6.2 Detroit – Diesel = 25+ MPG

2003 2500HD 8.1 Vortec – Gasoline = 9.6 MPG

Cost of diesel at the local Rez out here is 1.75

I’m actually quite pleased with my insurance cost, I think it’s more than reasonable for full coverage.

#112 Al on 03.31.22 at 9:10 am

What about this – “ Forecasts are for another hot summer in the market for getaway homes.

Royal LePage, the real estate brokerage firm, predicts the national aggregate price for a home away for home will rise 13 per cent in 2022 from last year, to $647,710 for a single family unit, as demand continues to outstrip supply”

No conflict of interest there, eh? – Garth

#113 crowdedelevatorfartz on 03.31.22 at 9:14 am

@#107 Ponzies prattle

“Many people would say that Oil Companies are acting like a Monopoly.”
++++

Sad that we have to explain that a “monopoly” is a single entity …not a group. Hence the prefix “mono”.

Sadder still that you had to use a Class Action by a Quebec group suing beef Packing companies.
Perhaps they should start cleaning their own back yard first, ie the Oligopoly named SNC Lavalin.

And all the other entities you have mentioned in your “quest ” to spew vitriol on the private sector has completely ignored the point.
All the companies were in the private sector.

The Insurance Corporation of BC is a GOVT MONOPOLY for car insurance in BC…as you well know.
The govt sets the car insurance rates and rakes in the money. Billions and billions of taxpayer dollars. Year in and year out. A govt monopoly that could ( and is) managed in other provinces by a healthy, competitive, PRIVATE sector with lots of options for the consumer looking for a good price, good service with easy options.

Using Apple ( not a monopoly) as an example is ludicrous but expected as were your other nonsensical examples.
Typical, pouting, pugnacious, ponzie.

#114 Dharma Bum on 03.31.22 at 9:17 am

Buy a house today.

In 20 years, it will be worth way more than you paid for it.

Nobody who bought a house 2o years ago regrets it.

The only constant with residential real estate is: “I shoulda bought it back then”.

Short term? Meh. Not so much.

Long term? Money in the bank.

#115 Shawn's my fake name on 03.31.22 at 9:26 am

Ignorance is bliss.

#116 crowdedelevatorfartz on 03.31.22 at 9:27 am

@#101 Don
“Dollarama now $5 Dollarama.”
+++
Five-arama?
Fin-arama?
Debt-arama?
Inflation Emporium?

#117 crowdedelevatorfartz on 03.31.22 at 9:51 am

@#112 Alley Oop !
“Royal LePage, the real estate brokerage firm, predicts the national aggregate price for a home away for home will rise 13 per cent in 2022 from last year, to $647,710 for a single family unit, as demand continues to outstrip supply”

+++

Ah yes.
The Real Estate shills “always looking on the bright side of life…”

The only other people that are worse at debasing themselves when speaking about Real Estate are….the media….which, is typically, in the back pocket of Real Estate advertisers.

#118 DON on 03.31.22 at 10:26 am

#116 crowdedelevatorfartz on 03.31.22 at 9:27 am
@#101 Don
“Dollarama now $5 Dollarama.”
+++
Five-arama?
Fin-arama?
Debt-arama?
Inflation Emporium?

******
lol

#119 Sail Away on 03.31.22 at 10:39 am

Re: monopolies

Illegal by private corps.

Totally legit when done by government. Way left-leaning gov at that.

Remember ICBC had a $1B deficit the first year, so they just doubled rates and the deficit magically turned to a surplus? Genius. They should teach at management school:

‘First, arrange a monopoly for a mandatory product…’

#120 Sail Away on 03.31.22 at 10:46 am

Now, as an example of a government recognizing the good work of their citizens, President Donald made national park access free-for-life to all vets and their dependents. So nice to feel loved:

https://www.nps.gov/planyourvisit/veterans-and-gold-star-families-free-access.htm

#121 Linda on 03.31.22 at 11:04 am

#19 ‘Peter’ – uhm, Peter? Government money IS your money. Your tax money. So in point of fact, you are still paying for things like ‘fixing rotten teeth’ with your own money, albeit at 3rd party arm’s length via your tax dollars. So no, you won’t have more money to spend on what you like unless you find a way to increase your net despite paying more in taxes. Good luck with that.

#122 Ponzius Pilatus on 03.31.22 at 11:07 am

#113 CEF
Using Apple ( not a monopoly) as an example is ludicrous but expected as were your other nonsensical examples.
Typical, pouting, pugnacious, ponzie.
——————I
I could have used Google as an Example.
You use it all the time to feed your delirious confirmation bias.
You should use abstract thinking once in a while.
Commonly called “Thinking outside the box”.
Too intellectual for you?
Gives you a headache?
Common for simpletons like you.

#123 Observer on 03.31.22 at 11:08 am

#75 Christopher Mewhort, EA on 03.30.22 at 8:27 pm
64 USA has capital gains tax for gains over 250K per person (per lifetime I think). This likely is one factor, among others, that makes Canadian housing more attractive as an investment and thus more expensive.
————————-
Please keep your day job and try to refrain from giving US taxation advice. Please!

Christopher Mewhort, EA
519-525-7277

^^^^^^^^^^^^^^^
What US tax advice do you think I was giving? And to who – Canadian or US tax payers?

#124 Don Guillermo on 03.31.22 at 11:17 am

#86 Moses71 on 03.30.22 at 9:45 pm
What? You mean under Trudeau’s gov’t the far reaching housing price issues are getting dealt with? Nice! And I’m sure there’s more up his sleeve to pay for how he had to help Canadians stay dignified during a pandemic. Good thing Harper isn’t still in power. And the Canadian military couldn’t stand him anyways

*******
I hear you. Leading the G7 was starting to get boring.

#125 Ponzius Pilatus on 03.31.22 at 11:21 am

#101 DON on 03.30.22 at 11:26 pm
Dollarama now $5 Dollarama.
———————
Soon to be renamed Rublerama.
Fitting for the rubble they sell.
They don’t give refunds.
So it ends up in the landfill.
My fave Coffee Crisp Is a good deal, though.
But, check the expiration Date.

#126 Mattl on 03.31.22 at 11:38 am

#53 Stone on 03.30.22 at 6:00 pm
#17 Mortgage guy on 03.30.22 at 4:23 pm
How would a tax on a principal residence affect the reverse mortgage world. Very complicated.

———

No. It’s actually really simple. It doesn’t matter what kind of mortgage you have. If there’s a capital gain at the sale of the property and it’s taxable, the owner of said property has to pay the capital gains tax. Period!

Why would you think it would be complicated? Taxes don’t cater to the taxpayer. They cater to the gouvernment that implements the tax.

—————————————————————-

Don’t be such a simpleton.

Sure, let’s assess cap gains on RE. What comes with that are mortgage interest deductions, capital improvement write downs and tax loss harvesting in the case of an underwater property at sale. It WOULD be complex, which is fine.

While we are at it I’d suggest taxing rentals. Why should rentals be protected from tax, as you say taxes don’t cater to the taxpayer.

#127 BillBC on 03.31.22 at 11:56 am

A blast from the past from an old guy. I bought my first house, an older 3 bedroom, in 1970 in a small prairie city, for $10,000, which was exactly my salary, a ratio of 1:1. Now in retirement in small town BC, my income is about $80k, and my 3 br house would have sold last month for about $880k (or more), a ratio of 11:1….a lot tougher to start out now than it was fifty years ago…

#128 crowdedelevatorfartz on 03.31.22 at 12:01 pm

Gee whiz.
So much for a healthy lifestyle eh Ponzie?
You can’t even avoid ICBC when you’re NOT driving a vehicle.

ICBC wants their “pound of flesh” from a cyclist hit by a car while riding …on a bicycle route….

https://globalnews.ca/news/8723936/vancouver-cyclist-icbc-bill/

The govt always wins.

#129 crowdedelevatorfartz on 03.31.22 at 12:03 pm

@#119 Sail Away

“Remember ICBC had a $1B deficit the first year, so they just doubled rates and the deficit magically turned to a surplus? Genius. They should teach at management school:”

+++

Please.
You’re wasting your time.
Ponzie doesnt deal with facts.
Just snark .

#130 Shawn on 03.31.22 at 12:10 pm

#78 Ponzius Pilatus on 03.30.22 at 8:44 pm said:

Monopolies.
That’s what the endgame in unfettered Capitalism is.

Look at Apple. Charge you 1k for a poduct that costs 50 bucks to make.

You know how high the mark-ups on glasses and hearing aids are? Insane.

I know they are talking about competition.
Where is Apple’s competition?
The minute one shows up, Apple buys them up for a pittance.

Well, but the share holders are happy.

**********************
Well then, it appears that your mission is clear: Buy Apple shares?

1. See opportunity 2. Seize opportunity.

#131 yvr_lurker on 03.31.22 at 12:43 pm

#113
The Insurance Corporation of BC is a GOVT MONOPOLY for car insurance in BC…as you well know.
The govt sets the car insurance rates and rakes in the money. Billions and billions of taxpayer dollars. Year in and year out
—————-

With private insurers, one could almost guarantee that there would be challenges in getting proper settlements and for them actually paying up. I have no faith that the Gov’t could regulate them properly. With the NDP in BC, and with the changes they made with regards to previously ballooning payments to lawyers for even very minor accidents, ICBC has been able to lower the rates and is now providing good service. It also helps that Christy Clark is not raiding the ICBC coffers for her pet projects. I have no complaints with ICBC at this stage.

#132 Damifino on 03.31.22 at 1:08 pm

#128 crowdedelevatorfartz

ICBC wants their “pound of flesh” from a cyclist hit by a car while riding …on a bicycle route….
———————————–

I’m not here to defend ICBC but it seems they’ve found the bicyclist partially to blame for the accident. Of course, ICBC, is famous for assigning “partial” blame. That’s always a win-win for them.

I don’t know the circumstances of his particular incident, but I’ve been driving in Vancouver for decades and seen some astonishingly stupid moves by bicyclists.

It’s as if they believe themselves to be protected by an invisible car-proof shield when they have everything to lose regardless of who may be at fault.

#133 The West on 03.31.22 at 1:22 pm

What a beautiful dog.

Well done Mark! Look into those eyes, she knows how good she has it now!

Cheers

#134 Damifino on 03.31.22 at 1:33 pm

Biden has clearly lost it. Mr. “Cancel-a-nearly-complete-pipeline-on-day-one” had this to say:

“…too many companies aren’t doing their part and are choosing to make extraordinary profits and without making additional investment to help with supply.”

Meanwhile the majority of those who elected Biden are committed to the divestiture of fossil fuel companies.

Now he’s going to draw down the USA strategic reserve.
If the reserve is “strategic” then what, pray tell, is the strategy? Silly old fool. Or is he just confused?

The former, I think.

#135 DON on 03.31.22 at 2:54 pm

#125 Ponzius Pilatus on 03.31.22 at 11:21 am
#101 DON on 03.30.22 at 11:26 pm
Dollarama now $5 Dollarama.
———————
Soon to be renamed Rublerama.
Fitting for the rubble they sell.
They don’t give refunds.
So it ends up in the landfill.
My fave Coffee Crisp Is a good deal, though.
But, check the expiration Date.

***********

Expiration date … i gave up buying any chocolate bars in any of the discount dollar stores.

#136 Barb on 03.31.22 at 3:47 pm

#99 Ustabe

You missed my point with your reply “The bold part certainly isn’t Trudeau’s fault now is it?”

I wasn’t referring to the Conservatives; my comment “devoid of any viable opposition” was referring to Jagmeet Singh now that he’s T2’s bed partner, content with rubbing his back for 3 more years.

The Cons were a non-viable opposition months ago, as they seemed to go whichever way the wind blew on any topic, on any given day…the Ottawa trucker siege being one example.

So, no argument from me that it’s “Trudeau’s fault.”

Re your comment “We worked with loads of bureaucrats and very few were socialists. Lots of NDP types but nearly matched by the Socred contingent with a sizable percentage of pure neutral types. To my perhaps imperfect recall.”

I too have worked with loads of bureaucrats, albeit from the perspective of an ordinary citizen starting a business versus an “industry-specific Board of Directors in Victoria”.

In my case, almost every bureaucrat needed one or two colleagues sitting beside them, apparently lest they need proof of what was said/promised, while I sat across the table on my own. They, to a person, frequently referred to reams of papers, comparing similar businesses in other communities relating to traffic impact, number of parking spaces, buffer from–and to–nearby farming or non-commercial adjacent zoning, public input from … “no, not 300 metres” became “should probably gauge opinions within 500 metres of subject property…” and on and on it went. Oh, and the development proposal sign to be posted on the property boundary got bigger and bigger the longer they discussed its content, and how long it would be posted “30 days? no, 60 days might be appropriate”.

The bureaucrats looked at one another when they spoke more than actually addressing me, the proposer.

I could continue but will conclude with my feeling that these bureaucrats were more concerned about not making any errors than they were with potentially welcoming a new taxpaying business in their community.

That wouldn’t have happened with your industry-specific Board of Directors, which is essentially a lobby group.

Yup, British Columbia’s bureaucrats are mostly socialist-minded. NDP thinkers. But I repeat myself.

#137 DON on 03.31.22 at 3:54 pm

#134 Damifino on 03.31.22 at 1:33 pm
Biden has clearly lost it. Mr. “Cancel-a-nearly-complete-pipeline-on-day-one” had this to say:

“…too many companies aren’t doing their part and are choosing to make extraordinary profits and without making additional investment to help with supply.”

Meanwhile the majority of those who elected Biden are committed to the divestiture of fossil fuel companies.

Now he’s going to draw down the USA strategic reserve.
If the reserve is “strategic” then what, pray tell, is the strategy? Silly old fool. Or is he just confused?

The former, I think.

***********

Bring prices at the pump down until after the midterm elections. Then he can let prices go back up again as he fills the reserves back up again. Politico short term thinking. Biden and Trump are borh spare parts.

#138 Satori on 03.31.22 at 9:10 pm

#116 crowdedelevatorfartz on 03.31.22 at 9:27 am
@#101 Don
“Dollarama now $5 Dollarama.”
+++
Five-arama?
Fin-arama?
Debt-arama?
Inflation Emporium?
—————————————–
Inflation Emporium!! :D My favorite!
Always love your comments CEF!!

#139 Tony on 04.02.22 at 1:46 pm

Re: #19 PeterfromCalgary on 03.30.22 at 4:29 pm

There’s nothing fun about low interest rates. Now we have worldwide inflation because the U.S. dollar is the reserve currency. Should the U.S. Fed dilly-dally with interest rates the entire world will be looking at hyperinflation. In a hyperinflation backdrop everyone goes poor including the former rich.

#140 Tony on 04.02.22 at 1:57 pm

Re: #114 Dharma Bum on 03.31.22 at 9:17 am

Some of the apartments in downtown Edmonton last year were selling for about the same as they cost in the year 2001 non-inflation adjusted. The exact same apartments that were sold in 2001 that were resold in 2021.