Life goes on

Joyce needs to get a life.

“I’ve been reading your blog since 2008 and look forward to reading it each and every day,” she says, unabashed. “Now I’m interested in your thoughts on my particular situation.”

Here’s the story: J & squeeze, late 30s, one spawn and two pooches sold their hideously inflated Ontario digs and moved to The Peg in time for a giant spring blizzard. But now, thanks to leaving the heartland, they have money. Almost three mill.

The plan was to wait until the inevitable softening occurs to buy here, however a near perfect house for our situation has come up. The market here has yet to turn the corner here but we have the cash to buy this house (will go for 1-1.2M and houses in this are rarely come up even pre-covid). My question is would you still recommend holding off and waiting for the cooling to come to Winnipeg? I’m trying to weigh the benefits of not living with parents or in a rental (nice rentals comparable to our old house that allow dogs are nearly impossible to find) to the cost of buying at the top of the mountain as you say. Our realtor is adamant Winnipeg is not Toronto and won’t suffer the same price declines over the next couple of years… what are your thoughts? If you have the money is it still crazy to buy a house in Winnipeg right now (30 showings on the house we are looking at so will almost certainly get multiple bids)?

As we all know this week, the housing market’s turned. It will soon be felt everywhere. Mortgages are 4%, on the way to 5% (where US home loans just moved), and central bankers will shock many with the unbridled manliness (can I still say that?) of their rate moves. This entire year will be one of escalating money costs, a slowing economy and serious angst among those who bought into an insane market in the last year or more (including Joyce’s purchasers). Poor kids.

But, wait. Life goes on.

Regular blog addicts will know what we have always said about residential real estate. If you need a house and can afford one without gutting your family’s finances, then go for it. Sadly this is not the case with thousands of recent buyers who have stretched heroically to secure a place they can’t really carry, often with a Bank of Mom loan or daddy co-signing. If prices decline 20%, or even 10%, they’re screwed. More debt than equity. They can’t even afford to sell, since that would involve writing a huge cheque on closing day. And this is what’s coming. The 905. Kelowna. Richmond. K-W. Wait for it.

Look at some of the comments realtors and mortgage brokers are hurtling around on Mr. Musk’s Twitter platform today: “Between us, I never thought the sentiment of one rate hike would travel so fast.” And, “I have seen many, many RE markets but Canada has been unique. List Thursday – guaranteed bidding war Monday. That’s over. Get used to properties on the market for weeks or months and be prepared to go down in price.” And this, “Two text messages last night: Offer night came and went. No offers. What do I do? Never had this happen before. Suggestions? …. Many agents haven’t worked in a real market where you have to price it correctly and market it and pray!” And, of course, this: “If a home buyer wants to buy a home today with a 5 year fixed rate mortgage of 4% They are qualifying based on a stress-test interest rate of 6% Let’s see how the housing market adjusts to that reality.”

“It’s a new world,” says mortgage dealer Ron Butler, “and, BTW, the prime rate hikes have just started.”

It’s not just the cost of money, although that is the single biggest determinant of real estate valuations. We’re also in an ugly time of recrimination and political incompetence. Millennial writers like Jen Gerson are foaming and gnashing about our “vampiric gerontocracy” and pushing the crazy meme that Boomers are eating the young, entirely responsible for crushing their lives (and sucking off their life juices. Yummy.) Of course, 50% of all real estate sales are to first-time buyers and the wrinklies largely stopped being a housing force decades ago. So guess who is setting prices? But, ya gotta blame somebody.

Anyway, they have the ear of half-cocked elected robots everywhere. So we now have taxes on foreign buyers, non-local buyers, second-property owners, people who own too briefly or too much as well as property tax hikes, punishing land transfer levies and at the same time incentives to encourage people to jump in. Suck and blow. Ironically, as the market cools fast and prices drop, buyers retreat, sales fizzle and we understand clearly once more we’re our own worst enemies. But, it’s easier to dump on Chinese dudes or old white guys. They don’t fight back. (Unless they have blogs and shimmering abs.)

Change, baby. Lots of it in the air. You won’t believe this summer.

Well, back to Joyce.

Buy the damn house. An upscale place for around a million in Winnipeg is a relative bargain. Yes, it may decline in value and stay that way for a few years. But you have the funds. You tell me you’ve got pensions and good incomes. The emotional downside of shacking up with family or compromising on a rental is greater than the financial risk of paying too much. When a house takes only a third of your net worth you are safely ensconced within the GreaterFool Rule of 90.

Just don’t gloat. Or tell Jen.

About the picture: “Just can’t say enough about how much we benefit from your blog,” writes Bruce. “Many decisions that we have made have been tempered by you and your colleagues wise words, especially the past two years. Our miniature Dachshund passed away at the ripe old age of 15. Here he is on Christmas Day shortly after we returned from Church. While we were gone he munched through a wrapped present and devoured over 100g of dark chocolate.  At the time he weighed just over 6 kilograms. Needless to say he recovered from his chocolate hangover and lived another 4 years. Cheers from Thunder Bay. 

132 comments ↓

#1 crowdedelevatorfartz on 04.14.22 at 1:32 pm

$1 million for a house in the Pig …err Peg.
Must be a doozy.

How many skeeters and black flies come with the sale?

#2 Concerned Citizen on 04.14.22 at 1:41 pm

I read Gerson’s piece yesterday, and I don’t think that’s a fair characterization at all of her argument. I believe her to be mostly correct, and it’s an uncomfortable truth for many to hear.

#3 Leo on 04.14.22 at 1:43 pm

Hate to say it, but Jen’s got a point. Canada is a RE $thole.

#4 "NUTS!" on 04.14.22 at 1:48 pm

“Millennial writers like Jen Gerson are foaming and gnashing about our “vampiric gerontocracy” and pushing the crazy meme that Boomers are eating the young, entirely responsible for crushing their lives (and sucking off their life juices. Yumm”

I love this! The Boomers were given interest rates north of 10% for most of their lives. I can’t wait to see the reaction from the young when prime reaches even half of that! Who are they going to blame for a historical norm?

#5 Shirl Clarts on 04.14.22 at 1:55 pm

Congrats Joyce on winning the housing lottery. But just because you have 3 million cash doesn’t mean you should blow your brains out on a million dollar house in Winnipeg. It sounds like you will be ‘trading up’ in terms of housing digs. You still need to do your due-diligence – check the comparables, taxes in the area, schools, and drive score.

There’s someone in our complex that just sold to someone for almost 400K over the last sale price in a multi-bid war. They clearly have the cash, but the shine will wear off after a few months.

Don’t be a sucker, Joyce. There are plenty of homes in Winnipeg under a million. Ask yourself why you want this one so bad. Also, big mistake if you told your realtor you will be doing a cash sale. Never reveal this, even to your own realtor, as this info is always used against you. I’d suggest finding another realtor that knows nothing about you, and keep your cards close to your chest.

#6 Ponzius Pilatus on 04.14.22 at 1:57 pm

192 Sail Away on 04.14.22 at 11:01 am
Re: nuclear waste

Of course it can be buried. That is, after all, where it came from in the first place.

Don’t build imaginary barriers by overthinking this.
———————
Sailo,
As a top notch engineer, you should know better.

#7 Captain Uppa on 04.14.22 at 2:01 pm

While I do like my GTA digs, the money I could leave with to another cheaper area or province could set us on an accelerated financial path.

Family is here.

Jobs are here.

Kids in a GREAT school.

Not an easy decision to leave.

#8 T simos on 04.14.22 at 2:03 pm

Jen is the new vampire slayer! OHHHHHhhhhhahaha!

#9 Captain Uppa on 04.14.22 at 2:04 pm

Also from Mr. Ron Butler today:

“If you convert from Variable today you are LOCKING IN 7 or 8 additional increases in Prime because most rate offers are between 3.79% and 4.09% on a 5 Yr Fixed and most people’s Variable even after the 50 bps increase is 1.85% to 2.05%

Holy Crap that may not be smart at all”

Seems like rates are still quite low.

#10 DON on 04.14.22 at 2:06 pm

This was an interesting read.

https://www.areteam.com/blog/arete-market-review-q122

#…Implications
So, the short answer to the question is “Yes”, we are in a new and more hostile investment landscape. After being conditioned for years to ignore risk, the emergence of inflation and geopolitical conflict changes the game. No longer do central banks have the flexibility to save the day whenever something bad happens. We all need to recalibrate to this new environment and manage risk more actively.

Another point is that risk is not just a binary phenomenon. There isn’t just no risk or big risk; this is too simple a characterization. Risk can come in the form of a single, big destabilizing event, but it can also come in the form of a long grind of tougher conditions. Risk mitigation efforts for these conditions are different and obviously also more costly if employed as a combined package.

More generally, the greatest risk is that of uncertainty – not even knowing what might happen, let alone knowing the probabilities. Earlier this year, not a lot of people had Russia invading Ukraine on their bingo card. A bewildering array of potential outcomes could spawn from that one event alone. Uncertainty, by its very nature, is hard to insure against. As a result, the most sensible response is to reduce exposure to risk altogether.

Conclusion
Investors have endured a number of bouts of turmoil since the financial crisis and each time it made the most sense to ride it out. It’s no wonder that many attitudes toward risk are so dismissive.

This time, however, there are good reasons to believe that a risk recalculation is needed instead. There is also good evidence to support that view. While liquidity conditions are likely to be good for the next few weeks due to seasonal tax receipts, long-term investors should view that more as an opportunity to reduce risk than to add to it. Those who continue “living in a dream world” are likely to awaken to a nightmare. “

#11 Søren Angst on 04.14.22 at 2:07 pm

“Mr. Musk’s Twitter platform today…”

You just have to love Elon. Twitter shareholders were going to sue him for not disclosing % ownership properly or something like that.

Elon solution:

https://youtu.be/gYyQYrdZR7w

I just love that guy.

Twitter little stick. Elon bludgeon mace.

—————–

I love it how contemporary and so on top of things that you are Garth. THAT was good.

#12 Søren Angst on 04.14.22 at 2:13 pm

“Mr. Musk’s Twitter platform today…”

You just have to love Elon. Twitter shareholders were going to sue him for not disclosing % ownership properly or something like that.

Elon solution:

https://youtu.be/gYyQYrdZR7w

I just love that guy.

Twitter little stick. Elon bludgeon mace.

—————–

I love it how contemporary and so on top of things that you are Garth. THAT was good.

And not even intrepid (let the bullets fly Garth) me will go near this Garth dirge of a ditty…

“(and sucking off their life juices. Yummy.)”

I also liked the “shimmering abs” self assessment.

Classic Garth today. Glad for it.

#13 DON on 04.14.22 at 2:16 pm

To state the obvious, how will this snow affect crops accross Canada. The weather repeator tried to brush aside the winter wonderland on most parts of eastern Van Isle as the usual Spring snow…When is the last time that happened?

Lots of folks are paying attention to the rate hikes. Two younger couples who are both building their dream houses using their first house as collateral. One couple bought in the last two years in a rural setting and one 7 years ago in an already overpriced urban market. The grind begins…

#14 Brutal on 04.14.22 at 2:22 pm

You have $3 Mill and you want to live in Winnipeg?

Ew. Why? There’s a great big world out there. Have some standards.

#15 Søren Angst on 04.14.22 at 2:23 pm

#6 Ponzius Pilatus

I would not say Sail Away is top notch but correct about burying nuclear waste.

Whiteshell Labs in MN has deep test wells for nuclear waste disposal. Toured them with one of their R&D PhDs. There for other nuclear related reasons.

That was a few decades ago.

Being decommissioned in 2024. Read the “PC” references to underground…

https://www.aecl.ca/environmental-stewardship/whiteshell-laboratories/

#16 Prince Polo on 04.14.22 at 2:31 pm

Buying a place in YWG for a cool mill??? It must be on Wellington Cres….the poshiest old-money street in the entire province.

On the other hand, she could move a block away from the river and probably save $250-500K on the purchase price.

I look forward to reading all of the (mostly uninformed) ‘Peg bashing. This one is the funniest so far:

#14 Brutal on 04.14.22 at 2:22 pm
You have $3 Mill and you want to live in Winnipeg?
Ew. Why? There’s a great big world out there. Have some standards.

#17 Sail Away on 04.14.22 at 2:32 pm

#10 DON on 04.14.22 at 2:06 pm

This was an interesting read.

https://www.areteam.com/blog/arete-market-review-q122

———

Don, Warren Buffett’s ‘institutional imperative’ regarding sentiment of the day is equally present with analyst predictions.

If the general theme of the day is that a downturn must surely be on the horizon, 99.9% of analysts will turn to flow with the stream. It’s an emotional response. An unwillingness to separate from the crowd.

How often are predictions of all types incorrect?

I personally will definitely not be reducing any risk exposure, and will continue to buy good companies at attractive valuations.

#18 Sail Away on 04.14.22 at 2:35 pm

#15 Søren Angst on 04.14.22 at 2:23 pm
#6 Ponzius Pilatus

I would not say Sail Away is top notch but correct about burying nuclear waste.

——–

Dolce, my unbiased view is that Sail Away is indeed top notch, and correct about most things he chooses to address.

#19 Sail Away on 04.14.22 at 2:42 pm

#13 DON on 04.14.22 at 2:16 pm

To state the obvious, how will this snow affect crops accross Canada. The weather repeator tried to brush aside the winter wonderland on most parts of eastern Van Isle as the usual Spring snow…When is the last time that happened?

———

The heavy snow is an excellent bounty of moisture for the prairies, at exactly the time it is needed for crop germination.

Several years ago- maybe 10 or so, on this exact date, Nanaimo received over 6 inches of snow, which damaged many fruit and magnolia trees since the blossoms and leaves held the snow. Major branch cleanups for the next couple of weeks.

#20 IHCTD9 on 04.14.22 at 2:45 pm

Let’s go brigade Jen’s blog :)

#21 A Borrower Bee on 04.14.22 at 2:46 pm

In that price range, bidding wars in Winnipeg are exceedingly rare. They usually only happen in the <$500,000 category. Frankly, houses in that price range are still the exception rather than the norm and sit for quite a while. Unless this is a very unique property, it may be best to avoid panicking.

#22 Kurt on 04.14.22 at 2:46 pm

So, where are all the in-bred chihuahua’s (yappy blog dogs) who barked “Garth hates real estate”? I can’t be bothered to look through the archives and hold them to account, but if they open their cake holes again, I’ve bookmarked this post and will happily rub their tiny noses in it.

#23 Linda on 04.14.22 at 2:47 pm

The face of regret in today’s dog photo:) Pup was lucky not to have more than a tummy ache from the chocolate binge!

Boomers are crushing the young & sucking off their life juices? Does that result in a youthful appearance & renewed frisk? Otherwise hardy seems worth the effort…..

‘Joyce’ asking whether she should buy given the circumstances is to me an indication of FOOP. Prices are starting to drop so let’s wait & get a bargain. Good strategy, except folks wait & wait & wait because they are now competing for the ‘best deal’ boasting rights. Maybe Winnipeg RE is currently way overpriced, but if the property is in a highly desirable neighborhood I rather doubt the price will drop much.

#24 What Could Go Worse? on 04.14.22 at 2:49 pm

Canada’s Oldest Bank Begs, “Could we PLEASE Stop With This Supply Myth?”
One of Canada’s most prominent economists really wants you to stop blaming high home prices on supply. BMO chief economist Douglas Porter explained Canada is promoting an incorrect supply narrative. In a piece literally called, Could We PLEASE Stop With This Supply Myth?, he breaks down a chart in Budget 2022. The Federal Government felt it showed how scarce housing is, but he argues it shows the opposite.

It’s important to note Porter advocates for more supply. However, addressing the wrong reasons for surging home prices means ignoring the problem. In fact, it risks exacerbating many of the same issues driving home prices higher.

#25 ElGatoNeroYVR on 04.14.22 at 2:51 pm

While I do agree that Jen makes some really good points ,the crux of the matter is simple , most of her generation has either not voted at all or voted for the current clique.
Politicians cater to actual voters not constituents , Simple as that !
Statstics clearly show actual voters by age group ,gender ,location ,percentage of constituents who actually voted…
Fifthing the wrong war here Jen is ,as Yoda would say. If her generation wants things to change they need to get organized and vote accordingly.

#26 Søren Angst on 04.14.22 at 2:51 pm

Twitter today falling over itself with meme’s for the sinking or very damaged Black Sea Flagship the Moscow. Some of my fave memes.

Shortcut Key Geek
https://twitter.com/SandisGrantins/status/1514418772051963905

Naval Reclassification
https://twitter.com/apmassaro3/status/1514423569727594501

WiFi Geek
https://twitter.com/metcalph/status/1514383780014071808

Postage Stamp in need of Revision
https://twitter.com/gtconway3d/status/1514462642072653828

Probable, Occams Razor end result per Lithuanian Defense Minister and Others
https://www.facebook.com/100002969526590/posts/4800110346764569/

Pavlov’s Dog Russian Navy
https://twitter.com/Liveuamap/status/1514629881501556739

—————–

PS:

Looting Russian Soldier loot, looted by Russian postal service.
https://twitter.com/taxfreelt/status/1514291638016917504

No honor among thieves in Russia.

Get out of Ukraine Russia before Russia delenda est really does become a reality by your own hand.

#27 PeterfromCalgary on 04.14.22 at 2:51 pm

“If you want to tighten policy you have to raise interest rates by more than inflation went up,” Summers said. “We’ve got to raise interest rates by more than 4 percentage points, we’ve got to raise them by 4% to stay neutral and we probably have to raise them more than that.”Mar 18, 2022 Larry Summers

#28 Ballingsford on 04.14.22 at 2:52 pm

Shimmering abs Garth! How about a photo of them to start your blog one of these days and give the puppies, kitties, and birds a day off. That’ll give the entitled millenials something else they wish they had.

#29 Re-Cowtown on 04.14.22 at 2:58 pm

#15 Søren Angst on 04.14.22 at 2:23 pm
#6 Ponzius Pilatus

I would not say Sail Away is top notch but correct about burying nuclear waste.

Whiteshell Labs in MN has deep test wells for nuclear waste disposal. Toured them with one of their R&D PhDs. There for other nuclear related reasons.

That was a few decades ago.

Being decommissioned in 2024. Read the “PC” references to underground…

https://www.aecl.ca/environmental-stewardship/whiteshell-laboratories/

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

Not sure why you want to bury the nuke waste. Gen VI reactors use it for fuel. It’s a two-fer; get rid of waste and generate electricity.

All we need is a PM with balls big enough to do the right thing instead of worrying about trying to hit the ever moving target of pronoun choices.

#30 west coast on 04.14.22 at 3:01 pm

buy the house. i waited. and waited. and waited. thought it was going to turn at some point. it never did. will it in the next year, perhaps. but, we also thought that years ago.

#31 Søren Angst on 04.14.22 at 3:01 pm

#18 Sail Away

On the nuclear waste and fight for your country Comments, you have 2 enthusiastic thumbs up from me.

#32 Nucular Bush on 04.14.22 at 3:21 pm

#186 Doug in London

Agreed with your posts. Solar and wind is a disaster.

However, this nuclear waste issue has to solved for, and solved for well.

No one is factoring the cost of storage of the thousands of years forward. No concrete structure lasts longer than 100 years reliably to store this stuff in.

Everyone says bury it. Well, for nuclear waste that lasts thousands of years, the time is there to poison the water table with this waste.

But who needs water, right?

Just like you cannot ignore the disaster that is solar and wind for obvious reasons, you cannot look past this nuclear waste problem. It needs to be solved. And once we do, then we can claim unicorns and rainbows are real.

#33 Flop… on 04.14.22 at 3:26 pm

Mr Bum, it’s Mr Flop here again.

Still haven’t gotten to Telluride yet but watched a PBS special last night about how the townsfolk came up with 50 million USD to save the valley floor from development.

Come to think of it I haven’t been anywhere in 2 year.

Do you think Bonny Henry will put up new Exit signs around the city so I can find my way out…

M47BC

https://www.telluridenews.com/arts_and_entertainment/article_6c9aca92-baac-11ec-a269-d7079de0e89c.html

#34 Millennial Realist on 04.14.22 at 3:28 pm

Great link to Jen’s article, Garth.

“….this country is a vampiric gerontocracy…”

So true.

That’s why epic shifts are on the way.

Boomers, be part of the change.

Or be run over by it.

#35 DON on 04.14.22 at 3:31 pm

#17 Sail Away on 04.14.22 at 2:32 pm
#10 DON on 04.14.22 at 2:06 pm

This was an interesting read.

https://www.areteam.com/blog/arete-market-review-q122

———

Don, Warren Buffett’s ‘institutional imperative’ regarding sentiment of the day is equally present with analyst predictions.

If the general theme of the day is that a downturn must surely be on the horizon, 99.9% of analysts will turn to flow with the stream. It’s an emotional response. An unwillingness to separate from the crowd.

How often are predictions of all types incorrect?

I personally will definitely not be reducing any risk exposure, and will continue to buy good companies at attractive valuations.

******
I said it was an interesting read…and you were compelled to quickly reply with some sense of authority to discount what a person was saying. Wasn’t that the point of the article. Has the geopolitical landscape not changed in the last few years. What exactly is the problem with reassessing risk when circumstances change.

Do what you want.

#36 ogdoad on 04.14.22 at 3:46 pm

Oh dear Gawd…almost 3Mil and choose to live in The Peg?

Really sorry but there are larger questions here:

1) What are you thinking? Oh right, falling into $$ doesn’t mean you have imagination. You know that mosquitoes bite in the winter there, right?

B) Just buy the house, man! Jeeze. Get your noses out of your excel spreadsheet. Plan to live there (the horror) ’till you get old then any paper losses are moot. I know, imagination. Too bad Canadians don’t have it anymore.

3)Make sure you, at least, buy an expensive car to park in your driveway. Then take some posturing, nose raising and hugging lessons (I can help). People talk. They’ll talk about your kia for sure. Good luck getting invited to a Christmas gala if you don’t.

iv) Look for a swinger club. Or [email protected]

Looking forward to hearing from you!

Og

#37 JSS on 04.14.22 at 3:46 pm

Winnipeg, nice city.

Was there. Nice assiniboine (city) park, character neighbourhoods, lots of nice beaches nearby. Went to one called Grand Beach. Incredible.

#38 Penny Henny on 04.14.22 at 3:47 pm

#16 None on 04.13.22 at 12:34 pm

My relationship this past year failed because an ultimatum was dropped: “Buy a house now or our relationship is over”.

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

You should have consulted that love doctor from a couple of days ago.

#39 JSS on 04.14.22 at 3:50 pm

#14 Brutal on 04.14.22 at 2:22 pm
You have $3 Mill and you want to live in Winnipeg?

Ew. Why? There’s a great big world out there. Have some standards.

you sound like you’re from Calgary

#40 Shirl Clarts on 04.14.22 at 3:51 pm

#14 Brutal on 04.14.22 at 2:22 pm
You have $3 Mill and you want to live in Winnipeg?

Ew. Why? There’s a great big world out there. Have some standards.

^^^^^^^^^^^^^^^^^^^^
Here are some Winnipeg standards. Alright, slightly above. No MDF mouldings or IKEA in this place!

https://www.realtor.ca/real-estate/23760800/1063-wellington-crescent-winnipeg-river-heights

#41 Sail Away on 04.14.22 at 3:59 pm

#35 DON on 04.14.22 at 3:31 pm

I said it was an interesting read…and you were compelled to quickly reply with some sense of authority to discount what a person was saying. Wasn’t that the point of the article. Has the geopolitical landscape not changed in the last few years. What exactly is the problem with reassessing risk when circumstances change.

Do what you want.

——–

???

You do know that when an article is posted to an open forum, some people may read it and respond with their opinion, right?

In the movie Captain Fantastic, the father discouraged his kids from using ‘interesting’ as a descriptor, instead expecting a more incisive and detailed analysis.

#42 SpeedWeasel on 04.14.22 at 4:04 pm

I concur with #14: Brutal. If you have that kind of money, why live in Winnipeg? I have been around the world and have seen some poor countries. But nothing prepared me for the bleakness of Winnipeg.

#43 Frances on 04.14.22 at 4:06 pm

I personally like Winnipeg. Hubby is in the CAF and was posted there for a few years pre-pandemic. I remember there was an amazing food scene (hopefully the small business restaurants are still thriving post pandemic), and everyone was super nice. Cost of living was low, and the airport provides direct flights down south in the winter. It’s also sunny a lot so the winter doesn’t seem as cold as it is. There is a coziness about The Peg….there are some cold days though. Anyway, at the time the only nice, luxury houses were in the Tuxedo district. I just looked quickly on realtor and can’t believe how many new, modern builds there are in that area – good for Winnipeg! If I had 3 mill I might consider picking up one of those modern mcMansions and living off the other 2 mill. Sounds like a nice life to me!

#44 Squire on 04.14.22 at 4:09 pm

I have some advise for the younger folks. I’m Gen X. We are not coveting our older generations wealth. Instead of getting a B.A. in BS try getting a Trade and work harder.
Stop whining and being jealous of other people’s wealth. If you had money would you want someone else saying you don’t deserve it? I thought so.

#45 Mehling on 04.14.22 at 4:10 pm

What is it with these entitled millennials (with no money and likely no work ethic / ambition) thinking the world owes them a home in some of the most aspirational and desirable locals in Canada?

She’ll never succeed in life being bitter, angry and resentful.

PS – Sail Away, there was an article on your ibonds in the WSJ yesterday but it’s password protected. They do a free trial for $1 USD for 2 months.

#46 Shawn on 04.14.22 at 4:20 pm

Life Goes On….

…Long After the Thrill of Living is Gone.

At least, if the mood of so many on social media and various blogs is any indication. It’s sad. So many people blaming the world for their situations.

#47 The West on 04.14.22 at 4:22 pm

Did you see the comment section in Jen’s article.

You are blessed by comparison Garth.

Have a great long weekend everyone!

#48 Ronaldo on 04.14.22 at 4:24 pm

Millennial writers like Jen Gerson are foaming and gnashing about our “vampiric gerontocracy” and pushing the crazy meme that Boomers are eating the young, entirely responsible for crushing their lives (and sucking off their life juices. Yummy.) Of course, 50% of all real estate sales are to first-time buyers and the wrinklies largely stopped being a housing force decades ago. So guess who is setting prices? But, ya gotta blame somebody
————————————————————–
Not just the boomers that have stopped being a buying force but the GenXers as well who started buying back in the late 80s. But yes, gotta blame somebody.

#49 Shawn on 04.14.22 at 4:25 pm

Housing Supply

#24 What Could Go Worse? on 04.14.22 at 2:49 pm

Canada’s Oldest Bank Begs, “Could we PLEASE Stop With This Supply Myth?”

**************
Sounds right to me. I followed housing start numbers in the U.S. and after the financial crisis they dropped to something like 3 times the number in Canada despite having 10 times the population.

Canada remained over 200,000 houses and probably averaged 250,000 for years and years.

To this day I believe you would find U.S. housing starts well under 10 times that of Canada.

We were way higher supply than U.S. per million people.. But some would argue that was offset by higher rates of immigration. I don’t know. I know we build a lot of houses. Actually how else would real estate be such a large part of GDP?

#50 Richard L on 04.14.22 at 4:27 pm

Read the Gerson article and I have to say she makes a few good points.

– removal of the capital gains tax exemption and replacement with mortgage interest deduction

– removal of government backed mortgage insurance so that banks would have to assess their own risk levels

Both of these would help restore balance and allow younger people to enter the market.

Not likely to happen.

#51 Mattl on 04.14.22 at 4:36 pm

We have no emotional attachment to our house and would love to cash that cheque, but rentals are impossible and pulling out kids out of their school district is not worth almost any amount of money. Seriously considering a move to the US, if moving may as well go big and start fresh.

#52 George S on 04.14.22 at 4:43 pm

Various comments about nuclear waste:

#6 Ponzius Pilatus on 04.14.22 at 1:57 pm
192 Sail Away on 04.14.22 at 11:01 am
Re: nuclear waste

Of course it can be buried. That is, after all, where it came from in the first place.

Don’t build imaginary barriers by overthinking this.
———————
Sailo,
As a top notch engineer, you should know better.

———————————————————
Nuclear waste can easily be buried but it is being saved for use in breeder reactors (and possibly bombs) once people realize that nuclear power is an essential tool in the war on climate change.
It must be why they don’t just bury it. Governments were merrily taking all sorts of nuclear material, making it into bombs and exploding them in the atmosphere and underground to see what happens for 40 or 50 years after WW2, all in the name of military defence and war. Once you refer to something as a “war” anything goes.

#53 Guy in Calgary on 04.14.22 at 5:01 pm

Although I thought the article was harsh, I think she was right.

Boomers will always argue that they paid 18% interest on their house but by simply getting in the house, they rode a wave for decades.

When you look at wage growth, inflation and the price of houses, you cannot argue in good faith the millennials don’t have it tough. Private sectors have disappeared and funding retirement adequately is challenging with the ever increasing cost of living and stagnant wages. Throw in the cost of daycare if you want a family and also want to keep working and it start getting pretty crazy.

#54 Guy in Calgary on 04.14.22 at 5:01 pm

I meant to type private sector pensions, not private sectors.

#55 Grumpy Cat on 04.14.22 at 5:03 pm

Good!

#56 Quintilian on 04.14.22 at 5:06 pm

#49 Shawn on 04.14.22 at 4:25 pm
“I don’t know. I know we build a lot of houses. Actually how else would real estate be such a large part of GDP?”

Likely because the price deflator doesn’t capture the extent to which the price per unit built distorts the inflated contribution to GDP.

I don’t think we are overbuilding, just over pricing.

#57 Bdwy on 04.14.22 at 5:08 pm

 Ponzius Pilatus on 04.14.22 at 1:57 pm

192 Sail Away on 04.14.22 at 11:01 am
Re: nuclear waste

Of course it can be buried. That is, after all, where it came from …
———————
Sailo,
As a top notch engineer, you should know better

………

Of course it can
“Deep geological disposal is widely agreed to be the best solution for final disposal of the most radioactive waste produced.”

And it is.

Where u gonna put it ponz? Got a basement?

#58 IHCTD9 on 04.14.22 at 5:20 pm

#40 Shirl Clarts on 04.14.22 at 3:51 pm
#14 Brutal on 04.14.22 at 2:22 pm
You have $3 Mill and you want to live in Winnipeg?

Ew. Why? There’s a great big world out there. Have some standards.

^^^^^^^^^^^^^^^^^^^^
Here are some Winnipeg standards. Alright, slightly above. No MDF mouldings or IKEA in this place!

https://www.realtor.ca/real-estate/23760800/1063-wellington-crescent-winnipeg-river-heights
——-

$53,516.65 annual property tax bill!

#59 Emma Zaun - GreaterFool Unpaid Intern #007 on 04.14.22 at 5:25 pm

Attention All Deplorables,

Thanks to Garth’s vulching savvy, there is a special treat for you for Easter Weekend.

Garth has managed to buy up several transport truck loads of Kinder egg Easter bunnies and chocolates at a deep discount.

These will be given to all deplorables in the steerage section for every comment you give.

Please eat at least 2 treats per comment.

For Sail Away, Turner Nation and crowdedelevatorfartz, make sure to eat at least 10 Kinder treats every time you post.

This will definitely be a nice Easter bonus for you all, and make things even better for the Amazons.

Happy Easter and Kinder Surprise ;)

#60 Republic_of_Western_Canada on 04.14.22 at 5:30 pm

God bless Donald Trump and Elon Musk.

#61 Land of ilk and funny on 04.14.22 at 5:35 pm

The 905. Kelowna. Richmond. K-W. Wait for it.

____________

Regrettably, Kelowna is immune from your prognostication. As the fastest growing city in Canada with some of the highest rents, housing affordability will continue to struggle. As an economist, you’d think you would understand the basic premise of supply and demand.

When people want to be somewhere, they will pay a premium for this.

Already happening. Look at the data. – Garth

#62 G on 04.14.22 at 5:44 pm

From Jens article – “And it’s why all of those doomsayers who have been predicting a housing collapse forever have been wrong so far. There is absolutely no way that any Canadian government will allow that collapse to come if they can help it, damn the cost. Too many people got too rich on housing for too long, and now we’re stuck with it.”

I can’t argue that, they wouldn’t be able the handle the social unrest.

Nobody credible has predicted a ‘collapse’ for Canadian real estate. – Garth

#63 Enter the Dragoon on 04.14.22 at 5:44 pm

“But, it’s easier to dump on Chinese dudes or old white guys. They don’t fight back. (Unless they have blogs and shimmering abs.)”

………..

Bruce Lee is back?!

#64 Trojan House on 04.14.22 at 5:44 pm

Wait until this hits in January 2023:

https://www.ourair.org/arb-truck-and-bus-reg/#:~:text=The%20Air%20Resources%20Board%20(ARB,requirements%20are%20currently%20in%20effect.

Apparently, it will affect about 80,000 trucks. Considering the largest port is in California with all the trucks needed to move those goods, this could have more serious implications across North America.

#65 In continents on 04.14.22 at 5:51 pm

Joyce, you’d better hurry!

Once Sail Away and company find out there’s a property available in one of the most desolate and repugnant corners of this continent, you’ll have a bidding war on your hands. It’s what they do.

Their leader fancies himself an investment guru!

#66 Bill on 04.14.22 at 5:53 pm

I’m always disappointed reading your articles when you select an angry millennial and swoop down to their level, contributing to the hate as you join in dividing the Boomers vs Young. Of course boomers are responsible for rising housing prices as they downsize and/or are part of the investor class driving up prizes. Don’t kid yourself in playing victim to Jen’s misguided anger.

It wasn’t me who cleaved society into the victimized kiddos and the vampiric gerontocracy. – Garth

#67 Grandv!ew on 04.14.22 at 6:01 pm

Owning real estate in Canada will cost you 60% of your AFTER tax income for 30 years!

Dog will never do this to you, just a damn cats……

https://twitter.com/StephenPunwasi/status/1514667119815892993

: Don’t worry. when you’re 50, we’ll find you a nice little box so you can die, have your cat eat your face off, and then be discovered when your neighbors complain about the smell.

… but first, we’re going to need 60% of your salary for 30 years.

#68 Brian on 04.14.22 at 6:02 pm

Better hold off Garth on those Kinder eggs!

More Kinder chocolate recalled in Canada for possible salmonella contamination

https://globalnews.ca/news/8754034/kinder-chocolate-recalled-salmonella-canada/

#69 Winner peg on 04.14.22 at 6:02 pm

On the other hand, she could move a block away from the river and probably save $250-500K on the purchase price.

…..

It’s not a “river” … it’s a flood plain! And she could save another quarter mill on restorations from the ensuing damage.

#70 I don’t know on 04.14.22 at 6:06 pm

30 west coast on 04.14.22 at 3:01 pm
buy the house. i waited. and waited. and waited. thought it was going to turn at some point. it never did. will it in the next year, perhaps. but, we also thought that years ago.

-Absolutely.

Zero point in waiting. Waiting for what? Prices to decline to a certain point? Not going to happen. The house that they want is the same house everyone wants.

It’s the same with equities. Any time we have a little red, you have the greedy waiting for further bargains. They always miss the bottom anyways -then double down on their talk of “what’s coming”.

Then the market advances 200% and they are quiet.

Same old tired message.

Anyways, if they are hoping to buy cheap real estate they will have to get in line, and it’s real long line.

IDK

#71 Cici on 04.14.22 at 6:15 pm

#7 Captain Uppa on 04.14.22 at 2:01 pm

I wouldn’t uproot your kids if it wasn’t absolutely necessary. You can always cash out later, when they’re off doing their own thing.

Besides, if a recession hits, you’ll want to be where all the jobs are. And even if we do actually get a downturn in housing, it will surely be short-lived, and your place will continue to grow in value so you’ll get more when you cash out later. Just my 2 cents.

#72 Michael in-north-york on 04.14.22 at 6:17 pm

#26 Søren Angst on 04.14.22 at 2:51 pm

Twitter today falling over itself with meme’s for the sinking or very damaged Black Sea Flagship the Moscow.
===

Karma in action.

Putin is the first commander-in-chief in history who lost a Navy flagship fighting a country that has almost no Navy.

#73 some name here on 04.14.22 at 6:24 pm

When she said “our realtor” I figured she hit send on the email then signed the offer. She only wanted someone else to tell her she was right or maybe convince her husband.
Does Jen have a blog or something? Not on Power & Politics anymore saw her once on the ctv version and only once.

#74 jess on 04.14.22 at 6:26 pm

Canada’s Andre De Grasse, Brendon Rodney, Aaron Brown and Jerome Blake celebrate after winning bronze in the men’s 4×100 metres at the Tokyo Olympics. The quartet was upgraded to silver on Thursday as Great Britain was disqualified for doping.

ostarine and S-23, which are muscle-building selective androgen receptor modulators. Ujah’s claim that he unknowingly ingested the substance was later rejected.

#75 ogdoad on 04.14.22 at 6:28 pm

OAN

Things are starting to turn…not sure what to do now. Sig. is nailing it. Cute as hell…1am is the time. Its og’s hour. Keep it comin’…we gave us little blues, right?

mmmmm…gym is losing its luster…am I giving up too soon? Baby blues is killing me. How much do you give? Oh mama, give me oxy…skin on skin, that’s it.

Time for a change? 100% won’t be The Peg. Silly humans and lack of imagination. Won’t be judged there….confidence dies with the cold…

One touch…I gotchu

Og

#76 Shirl Clarts on 04.14.22 at 6:29 pm

#1 crowdedelevatorfartz on 04.14.22 at 1:32 pm
$1 million for a house in the Pig …err Peg.
Must be a doozy.

^^^^^^^^^^^^^^^^
Pig?… nice try. You’re the first to call it that. It’s just not a thing.

#77 DON on 04.14.22 at 6:30 pm

#41 Sail Away on 04.14.22 at 3:59 pm
#35 DON on 04.14.22 at 3:31 pm

I said it was an interesting read…and you were compelled to quickly reply with some sense of authority to discount what a person was saying. Wasn’t that the point of the article. Has the geopolitical landscape not changed in the last few years. What exactly is the problem with reassessing risk when circumstances change.

Do what you want.

——–

???

You do know that when an article is posted to an open forum, some people may read it and respond with their opinion, right?

In the movie Captain Fantastic, the father discouraged his kids from using ‘interesting’ as a descriptor, instead expecting a more incisive and detailed analysis.

*********

Oh i get it…but you have a track record of playing happy instigator.

#78 Quintilian on 04.14.22 at 6:58 pm

“Nobody credible has predicted a ‘collapse’ for Canadian real estate. – Garth”

Some people have enough conviction to state clearly what they believe.
Others have a compulsion to straddle the fences.

And a collapse will not occur. – Garth

#79 Nonplused on 04.14.22 at 7:01 pm

Speaking of Musk, I am not really sure what he’s got planned this time. $41 billion for a chat site? Greater Fool must be worth at least a billion then.

But so far it has been a bad idea to bet against Musk. Maybe reintroducing free speech to the internet is going to be a market winner.

On the plus side, I understand all the lefties are quitting, so moral has already improved.

Oh and buy all the things. Especially a house in Winnipeg if you are sitting on $3 million and for some strange reason want to live there. Toronto not so much.

Although who knows? According to ShadowStats, if inflation were measured the way it was during the Carter administration, what we are experiencing now is actually worse than the 70’s. Quite a bit worse. Maybe we’ll all be using rubles next year and the Loonie will be worthless? At least these folks will have a house.

But Trudeau and Freeland have a plan! Give everyone more free money! UBI! The solution to too much money is even more too much money.

#80 or_maybe on 04.14.22 at 7:03 pm

Wait a sec, I asked the [email protected] what these higher rates will mean for savings accounts? Apparently not really much and she politely obliged me to invest in the bank’s shares.
Oh wow, what a privilege I responded.

But then she said something even more interesting, that once the lending rates peak at 5-5.25% sometime late next year, the [email protected] expects the rates to return to about 2.25% Locked in for 2 years was the right strategy after all!

#81 Ponzius Pilatus on 04.14.22 at 7:15 pm

#57 Bdwy on 04.14.22 at 5:08 pm
 Ponzius Pilatus on 04.14.22 at 1:57 pm

192 Sail Away on 04.14.22 at 11:01 am
Re: nuclear waste

Of course it can be buried. That is, after all, where it came from …
———————
Sailo,
As a top notch engineer, you should know better

………

Of course it can
“Deep geological disposal is widely agreed to be the best solution for final disposal of the most radioactive waste produced.”

And it is.

Where u gonna put it ponz? Got a basement?
——————-
You should read again what our top notch engineer Sailo says.
Uranium that’s is mined in not radioactive.
It needs a nuclear reactor and fission to become nuclear fuel.
And nuclear waste is radio active for a long, long time.
So, what is being taken out of the ground is not the dangerous stuff that’s being buried.
Got it?

#82 Van on 04.14.22 at 7:29 pm

Feeling very sad. I’m in my late 30s and have been working very hard. I’m nowhere close to having 3m. Just didn’t buy a house in the right time…

#83 or_maybe on 04.14.22 at 7:36 pm

#52 – George S
Nuclear waste can be easily buried
————————————————–
liquid fluoride thorium reactor (LFTR)
thorium is a radioactive element that could be used to generate low-carbon electricity. Compared to the uranium that is used in today’s nuclear plants, thorium is more abundant and widely distributed in the Earth’s crust. It also offers various safety benefits over uranium: it’s not susceptible to generate chain reactions that can lead to nuclear disasters. Its waste products remain dangerous for a much shorter period, and its byproducts aren’t useful for making nuclear weapons. In addition, thorium reactors could theoretically be used to burn up the dangerous plutonium stored in existing nuclear waste stockpiles.

If Truman had not dismissed the advice of his nuclear scientists and fired them – because of the Ruskie threat and the race to MAD – the world would have less CO2 emissions and abundant cheap energy.

#84 Dale on 04.14.22 at 7:50 pm

the highest 5 year GIC rates are in the 3.7% to 4% range now and as interest rates go much higher, we will be in the 2000 to 2001 range of 6% to 6.45% for 5 year GIC rates. now, we even have 6 to 10 year GIC rates that are CDIC insured that will be 6.5% to 6.75% in coming years.

#85 CJohnC on 04.14.22 at 7:58 pm

From yesterday #157 Doug in London on 04.13.22 at 11:43 pm

Doug, I think you missed my point which was that it takes 10 more burning of fossil fuels to build green machines than just leaving them alone. Green machines meaning electric cars, wind turbines, solar panels etc. it uses more because of the extra mining and processing it takes to build them as well as the extra used to build the machines that build the machines. Not any of it is actually green. Nor are any of these green machines recyclable which is also not green. The whole green movement is built on whimsical thinking not any real analysis.

The only energy source that is green and recyclable is nuclear. (And yes you did mention nuclear in another post).

I do get that your concern is with urban sprawl and the wish for walkable cities.

#86 crowdedelevatorfartz on 04.14.22 at 8:13 pm

@#76 Shirly yer not kidding
“Pig?… nice try. You’re the first to call it that. It’s just not a thing.”

+++

Never heard it called “Winterpig”?
Perhaps this week?
During the mid April blizzard?

#87 crowdedelevatorfartz on 04.14.22 at 8:15 pm

@#69 Winterpig
“It’s not a “river” … it’s a flood plain! And she could save another quarter mill on restorations from the ensuing damage.”

+++
Bwahahahaha.
Maybe they’re selling before the latest snow fall melt hits with the spring floods.

#88 Left GTA on 04.14.22 at 8:26 pm

I get what some of these millennials are complaining about but I also still do not get it. My parents are boomers… For example there was no starbucks when I was growing up. People made coffee at home and took it in a Thermos, we didn’t eat out meals or order uber eats… we cooked meals at home. When we bought a house we didn’t spend thousands to reno it. We kept it clean with water and vinegar and lived in it. We went on a vacation by plane once a decade not once a year… We went camping, wore hand me down clothes and biked everywhere instead of driving. We grew vegetables and fruit in our gardens. We canned everything. We hung our clothes on a line in our yard and only used the dryer in the winter. Dryers lasted 30 yrs… All I know is we lived way way more frugally, never had debt and paid our mortgage off early. We also moved our bodies more, ate less and watched less TV. We lived in a 1000 sq ft house with 1 washroom for most of our lives but then my Dad finished the basement by himself and added a powder room. Perhaps the millennials should have some insight into what they are complaining about. The average house size in the burbs must be around 1600sq ft. lol and people are having less kids. I am pretty sure their mtg averaged 9% for the 20 years they had it. My dad did all the repairs on the house including a new roof and windows. The only thing he didn’t do was put siding on the garage. My Dad got up every morning at 5am to drive from west of Hamilton to Oakville to catch the train to Toronto home at 6:15 for dinner. He did that for 41 years. They sold our family home and a builder tore it down and put a 3000sq ft home on the lot. Then you wonder why homes are so expensive.

#89 Emma Zaun - GreaterFool Unpaid Intern #007 on 04.14.22 at 8:28 pm

#68 Brian on 04.14.22 at 6:02 pm
Better hold off Garth on those Kinder eggs!

More Kinder chocolate recalled in Canada for possible salmonella contamination

https://globalnews.ca/news/8754034/kinder-chocolate-recalled-salmonella-canada/

Shhhh. Brian, go away.

Garth, please delete that post

#90 Truck Trudeau on 04.14.22 at 8:36 pm

SIMS: Trudeau is planning a tax on trucks

The tax bill would range from $1,000 for light-duty pickups to $4,000 for the super-duty trucks that tow horse trailers and construction equipment.

Vehicles are provincially regulated, taxed and registered. Seems improbable, as much as the Greenpeace enviro minister wants it. – Garth

#91 Smokanagan on 04.14.22 at 8:49 pm

#61 Land of ilk and funny on 04.14.22 at 5:35 pm
The 905. Kelowna. Richmond. K-W. Wait for it.

____________

Regrettably, Kelowna is immune from your prognostication. As the fastest growing city in Canada with some of the highest rents, housing affordability will continue to struggle. As an economist, you’d think you would understand the basic premise of supply and demand.

When people want to be somewhere, they will pay a premium for this.

Already happening. Look at the data. – Garth

__________

I always do before I post. Dozens of articles and stats.

https://www.kelownanow.com/watercooler/news/news/Real_Estate/House_prices_up_up_up_in_Kelowna#fs_110650

Data. Not month-old realtor-generated media releases fed to a local news site without functioning reporters. – Garth

#92 Phylis on 04.14.22 at 8:50 pm

#88 Left GTA on 04.14.22 at 8:26 pm … and we yelled at our kids for sitting in front of the idiot box and told them to go outside and play. The kids today….

#93 John on 04.14.22 at 9:08 pm

Thankyou Garth, for always being there to help the downtrodden, the underprivileged, the oppressed, the 30-something year olds with net worth of $3 million who are tormented about their million dollar house purchase and need your free advice. Thank goodness you exercise your talents for such worthy causes…..

I help anybody. Even the insanely jealous and terminally spiteful. Hug? – Garth

#94 Robert Ash on 04.14.22 at 9:11 pm

I read Jen’s article and I can understand, her and many young people’s angst today.. It is much harder to get a start, than 40 years ago.. Sadly the Jen’s out there, don’t recognize that they are voting the wrong people into office. There are very few smart strategies, for Private Sector job growth. The fact that in the early 90’s the Politicians, promoting Globalism, set the future for wage and labor destruction, which in my opinion, is the real long term consequence of offshoring jobs. It may have been necessary, since the World possibly could not function with a large percentage advancing while other areas, seem to be stalled developmentally.
However the rapid offshoring of labor, for Canadians, Americans, and Western Europeans, is in my opinion, the major change that affected all our standards of living, from an employment and career perspective. The decision to move to a Service economy looks, great on paper, but long term, it has benefited the Fang companies, and their limited number, of developers and employees.. The others not so much… Finally Jen should realize her power is with her voting demographic. Older folks, did not elect people, like our current leaders. We insisted on less Governance, and didn’t pay Transfer fees, additional taxes, etc. etc… The Boomers need Immigration to sustain, many, but that might be a place to start if I was a younger person, voting. If Immigration is limited, the downside is the loss of new ideas, and trends, etc, that we benefit from, by including new Canadians. It is a difficult task, and there are many torques on Canadians, however less Government, will translate to more money in young peoples pockets.

#95 Dr V on 04.14.22 at 9:12 pm

Jen seems angry.

I’ve never paid more than about $250k for real estate.
Well maybe $300k with appliances, heat pump and landscaping.

And I’ve never sold a house for more than $111k.

While I feel for my kids, how is any of this my fault? Other Mils I know (family and others) have done fine.

#96 Robert Ash on 04.14.22 at 9:27 pm

I have a question, … If Housing Prices have gone up 52% ( Capital Economics), in one year.. How can Canadian real estate, not avoid a serious correction, or a crash in some markets?
The same can be said for Equities. Microsoft share price on Jan 1 2018, was $88.19 USD/share. What did Microsoft do, since 2018, that caused their stock price to triple.. The Cloud? Common, user, ridiculous, fake, monetary policy, so the correction will not just be real property, it is happening in the Bond market, and will keep on happening, to over priced assets, caused by an imbalance in the Credit markets. Just my crystal balling.

#97 Ustabe on 04.14.22 at 9:34 pm

#77 DON on 04.14.22 at 6:30 pm

Oh i get it…but you have a track record of playing happy instigator.

Go easy, its obvious our resident narcissistic sociopath is on a new pharmacological regimen. They must be still doing some work on dosages is all. Hence the obsequious, smarmy good guy posts, one after another, of late.

Its difficult to ask for help, never mind accept it, give the man some slack.

On another topic, if you are still able to consume fried eggs try dosing the fry pan with a dash of chimichurri , then cracking your eggs onto that. Give things a moment to set a bit, splash with water and cover to self baste.

#98 Ustabe on 04.14.22 at 9:47 pm

Sadly the Jen’s out there, don’t recognize that they are voting the wrong people into office.

Maybe we could work on the getting the right people to run on the right platform so the Jen’s have a real, articulated choice?

All Jen sees is failure of the CPC to address her concerns time after time, election after election, yet one constant is a fascination with her womb.

Now, I don’t have a womb but even so the CPC has nothing for me despite my decades of both volunteer and paid work for the now defunct PC party…which managed to get elected from time to time.

We all need to listen to Garth who, recently, has stated time over time what it will take to defeat the Liberals at the polls when it counts.

#99 miketheengineer on 04.14.22 at 9:57 pm

Hey Garth:

Those guys won’t go under. Options, move back in with mom and dad, convert the basement to a self contained illegal appartment, and they will collect rent on their home. They won’t take a loss, just use their line, draw out 30 or 40 k to create their rental. Problem solved, no one losses anything. Home prices flat line or have a slow decline. Or they go back to the bank of mom and dad and get more cashola. Nobody will take a loss if they can find a way to avoid it….every home can have part of it converted to rental space. My aunt used to rent her 2 spare bedrooms to students as she was close to the college to make ends meet when her spouse passed. It can be done.

Was looking at properties in St. Thomas Ontario….newer stuff over 1 million detached…but you are in small city living. They cost too much for your location…can’t justify the move just yet.

#100 crowdedelevatorfartz on 04.14.22 at 10:00 pm

@#88 left GTA
“We lived in a 1000 sq ft house with 1 washroom for most of our lives ……..

……They sold our family home and a builder tore it down and put a 3000sq ft home on the lot. Then you wonder why homes are so expensive.
+++++

Thats a Bingo.

#101 neptunian on 04.14.22 at 10:15 pm

if Joyce and family plan to settle down in winnipeg, the house is not an investment, it is a home, so ignore the “potential” money loss on paper, buy it and enjoy the life. home can not be valued by money. oh, it only costs 1/3 of you asset. then why wait?

Garth is a true financial advisor, who puts the client’s interests/needs at the top. Thumb Up!


for now, the rate hike has more emotional impacts. the monthly payment will not increase until renew, just a bigger portion is now interest. the true effect will be in 12-18 months when more and more people need to renew the mortgage, if the rate is not lower at that time.

but if most of the genius-RE-investors think this is not just a small adjustment (like 2017-2019, which by the way, was saved by covid) and start selling, it will not be pretty.

#102 baloney Sandwitch on 04.14.22 at 10:36 pm

Re: Mr. Musk’s Twitter platform – Musketeer ?
I hope not.

#103 Winterpeg on 04.14.22 at 11:32 pm

You have won the lottery by selling in southern Ontario and moving to Winnipeg. But there are bidding wars in Winnipeg too, so don’t go nuts. I would agree with others who said stay under 1million. You can get a great place for less. And just like everywhere else, prices could soften in awhile. Also note that property taxes are high here in the Peg. Save your extra cash for winter getaways. This was a particularly brutal winter (although the previous year was unseasonably mild). Winnipeg does have its’ good points though, no matter what the nay- sayers say. The arts, sports teams, close to lake country.

#104 Diamond Dog on 04.14.22 at 11:58 pm

Well Joyce…

On one hand you and yours has 3 mil. On the other hand if you buy this house for 1 to 1.2 mil, 2 years from now don’t be surprised if this same house is worth $ 600k to 700k and be a frozen asset or unsaleable. If you know you will be living in Manitoba for the next few years at least, you can afford to buy it still knowing that $ wise, it’s not practical but socially soothing.

However, if you don’t know where you will be a few years from now or more, you might want to rethink it.

Why? Canada should be in the ugly bottom of a recession next year for a good 4 to 6 quarters (I think closer to 6). As with all recessions, there will be unemployment, tighter credit, less money circulating, less government spending and higher taxation crushing the spend free consumer behavior we see now.

Canada and the U.S. is currently in an overheated economy caused by a grotesque rapidly increased money supply, easy credit through the U.S. Fed buying it’s own bonds, buying MBS’s, banking deregulation and of course, more than a decade of rock bottom interest rates both Fed and prime creating wealth effects in real estate, stock markets, bond markets and lately, commodities.

Did I say overheated economy? Try cooked! The evidence is everywhere (like 8.5% inflation, also a cooked number) and it didn’t happen overnight.

This year, we are about to witness continued rate hikes from North American CB’s basically until something breaks. This of course, is the point. The only way to take down inflation is to suck money out of the supply which leads to? Recession.

It’s not “if” we see a recession, its “when”. It could begin as early as this summer or come as late as Q2 of next year. (I don’t see a recession later than Q1 myself) By the end of the year, the Fed rate will be somewhere around 2.5 to 3%. I can’t see the Fed rate going past 3.5% before something breaks, but one should be prepared for as high as 4%. If the Fed rate hits 4%, 30 year mortgages already at 5% will be in the 7%’s. Canadian 5’ers won’t be far behind. Add a couple points for the stress test and you get the idea of where real estate is headed.

The U.S. AND Canada is in a bad spot. CB’s have no choice but to raise rates to tame inflation. They have no choice at all. Anyone who thinks they have a choice s financially illiterate. The big concern is, if the Fed raises rates high enough to induce a recession and inflation is still high, mix in some fiscal instability and this becomes the Minsky moment:

https://www.investopedia.com/terms/m/minskymoment.asp

So I’ll say it again. You can afford to buy the house, we know that much. But unless you know, like know it in your bones that you’ll be living in Manitoba for the next few years or more, I’d think again about buying that house. Hope this helps.

#105 AM in MN on 04.15.22 at 12:20 am

So many topics to pick from today…

I think I’ll number them to help stay focused;

1) Boomers sucking the life out of the youngsters.

Well the free health care and drawing from the underfunded CPP are a big part of it, especially after raking in a big windfall when they sell their house.

Anyone working for a paycheck will be paying for the money printing party for the rest of their lives. Serfdom can make some unhappy.

Check the age (young) cohort among the thousands at the PP rallies. You won’t see anything about it in the Toronto media, and of course you can discount it because having many thousands of people show up to hear a politician is normal and not indicative of how people will actually vote. The elite financial classes (Garth’s people) have nothing to worry about.

2) Recession.

Not like in the past. A change in the economy from consumer purchasing and residential real estate upgrades and construction, to an industrial and commodity boom that still has vast shortages to make up for in the next several years. No shortage of jobs, but maybe not in the better postal codes to live in.

3) Interest rates.

Markets do ultimately rule, but I have no faith in the BoC/LNDP to take the pain required to lower inflation. It has only one cause, money printing, mostly through low interest rates and purchasing government bonds so they could shower cash on the serfs, with a healthy dose for their friends.

Pick your poison, but I say they keep showing their friends and woke constituencies and let the paycheque serfs suffer.

4) Nuclear Waste

No risk when you bury it deep enough, well below the water table, below say 5,000 feet in rock like the Canadian shield.

Small reactors are the future, and several projects are moving ahead in Canada, but the country needs to allow more uranium mining and processing. Could be a much bigger export industry.

Solar, wind and now battery storage and EVs are growing in many parts of the world. The trend will continue because people want it.

Technology moving quickly on battery storage to be able to allow vast battery farms to behave to the grid like a synchronous generator. This will allow the shut down of large coal plants and be able to keep gas turbines on cold standby instead of running them at min. throttle and waste huge amounts of natural gas just to stabilize the grid. Check out what’s going on in Texas these days.

The bigger issue will be the fight to use new technology to decentralize the grid and start to take apart the huge monopoly behemoths (and their unions!) that have an iron grip on the power industry.

#106 Lord Garth of Izar on 04.15.22 at 12:24 am

DELETED

#107 Linda on 04.15.22 at 1:31 am

Looked at the Winnipeg RE listing. Seriously ostentatious. 18,000 square feet? When one considers that roughly half of all Canadian households comprise of 1 or 2 people, seems a tad oversized. Maybe the photos didn’t do the place justice, but I got a real commercial vibe from them. More like a place where I’d rent a room or suite for the night, not a family home I’d want to live in!

#108 Jane24 on 04.15.22 at 1:56 am

If you have 3 million why move to Winnipeg? I used to go there for work and although very nice people the place is a freezing, buggy dump.

Go to France. Spend 1 million on a decent chateau and live off the other 2 million. You won’t miss family and friends as with 12 bedrooms in France you won’t be able to get rid of them.

#109 BigAl (Original) on 04.15.22 at 5:00 am

#88 Left GTA on 04.14.22 at 8:26 pm
I get what some of these millennials are complaining about but I also still do not get it. My parents are boomers… For example there was no starbucks when I was growing up. People made coffee at home and took it in a Thermos, ……..

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

“We can’t bust heads like we used to. But we have our ways. One trick is to tell stories that don’t go anywhere. Like the time I caught the ferry to Shelbyville. I needed a new heel for my shoe. So I decided to go to Morganville, which is what they called Shelbyville in those days. So I tied an onion to my belt, which was the style at the time. Now, to take the ferry cost a nickel, and in those days, nickels had pictures of bumblebees on ’em. “Gimme five bees for a quarter,” you’d say. Now where were we… oh yeah. The important thing was that I had an onion on my belt, which was the style at the time. They didn’t have any white onions, because of the war. The only thing you could get was those big yellow ones…”

“You see, back in those days, rich men would ride around in zeppelins, dropping coins on people. And one day, I seen J. D. Rockefeller flyin’ by– so I run out of the house with a big washtub, and—Anyway, about my washtub. I just used it that morning to wash my turkey which in those days was known as a ‘walking bird.’ We’d always have walking bird on Thanksgiving, with all the trimmings. Cranberries, ‘injun eyes,’ and yams stuffed with gunpowder. Then we’d all watch football, which in those days was called ‘baseball.’”

Grandpa Simpson

#110 I don’t know on 04.15.22 at 5:21 am

#96 Robert Ash on 04.14.22 at 9:27 pm

Because interest rates aren’t the only factor in house prices. A big factor, but only one of many.

Think demographics, population, cost of building, zoning laws, cultural preference, urbanization, small family units and so on.

A huge issue is that paying rent isn’t much better for most, especially those who want to lay down roots and stability. Finding a suitable rental can be a challenge. Renters are by and large less wealthy and stable than owners. There are renters who have huge portfolios and live well, but they are a minority.

Most people understand you buy real estate the moment you can afford to. No one has a crystal ball saying prices will be lower. A lot of people hoping, but my experience is the second they enter the market the tune changes very very fast.

IDK

#111 I don’t know on 04.15.22 at 5:31 am

“And a collapse will not occur. – Garth”

Our host is correct. Again.

My experience is those hoping for a collapse (housing market, stock market, society), do so out of their own uncontrollable greed.

The moment they enter the market, particularly housing, the tune changes like a light switch. Then it’s all about renos, equity, rental income and cp24 hot property.

IDK

#112 crowdedelevatorfartz on 04.15.22 at 8:08 am

@#124 Jane24
” I used to go there for work and although very nice people the place is a freezing, buggy dump.”
++++

People dispose of their old buggy’s in Winnipeg?
Who knew.

#113 Dharma Bum on 04.15.22 at 8:30 am

You lost me at Winnipeg.

Canada’s Fargo.

Ugggggghhh.

#114 crowdedelevatorfartz on 04.15.22 at 8:41 am

One wonders if the grandson was told to visit before it’s too late.

https://www.reuters.com/world/uk/uks-prince-harry-meghan-visit-queen-elizabeth-2022-04-14/

#115 Dharma Bum on 04.15.22 at 9:23 am

#88 Left GTA

We went camping, wore hand me down clothes and biked everywhere instead of driving. We grew vegetables and fruit in our gardens. We canned everything. We hung our clothes on a line in our yard and only used the dryer in the winter.
——————————————————————————————————
Damn HIPPIES!

LOL

Man, I just crack me up.

https://www.youtube.com/watch?v=X7e5ftF4ZL4

#116 Sail Away on 04.15.22 at 9:51 am

#97 Ustabe on 04.14.22 at 9:34 pm

Go easy, its obvious our resident narcissistic sociopath is on a new pharmacological regimen. They must be still doing some work on dosages is all. Hence the obsequious, smarmy good guy posts, one after another, of late.

———-

I fail to see relevance of your comment to the topic at hand; it almost feels like a purely gratuitous insult?

Seems sorta low class.

#117 TurnerNation on 04.15.22 at 10:29 am

Among the suggested multiple growth funding tools to help pay for new infrastructure and updates as the population expands is a hike in the development charges presented to developers building in the city be increased by a whopping 49 per cent across the board for residential projects.
https://www.blogto.com/real-estate-toronto/2022/04/toronto-raise-cost-developers-build-new-condos/

#118 Jo on 04.15.22 at 10:34 am

#88 Left GTA. That’s exactly how my partner and I got ahead. That plus of course Garth’s blog.

#119 Gr on 04.15.22 at 10:43 am

Some might be interested.
They can make a tinny bit at night.

These Solar Cells Produce Electricity at Night
https://spectrum.ieee.org/solar-cell

#120 Sail Away on 04.15.22 at 10:54 am

Here’s one of those ‘alternative investments’ I’ll be picking up. Consider it a buy and hold for the long term.

https://www.npr.org/2022/03/13/1086371078/ukraine-russian-warship-postage-stamp

#121 Shawn on 04.15.22 at 12:17 pm

Summertime’s Inflation Math gone wrong

#168 Summertime on 04.14.22 at 6:54 am responded to me:
#134 Shawn on 04.13.22 at 9:12 pm

You need to be more creative. For example:

You got free gloves ($ 40 value) when you purchased that $ 1200 famous brand Canadian winter jacket.

From 40 bucks to zero is infinite deflation so even those gloves constitute 0.001 % of your expenses the end result is still infinite deflation, so there is no inflation, and if there is, it should be as statistics Canada stated: sub 2 % and in exceptional cases and only temporary/as of now/and for a very long time/still temporary/ sub 6%

This is how math works in this place.

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

Summertime, that was truly a good effort. The free gloves scenario was indeed creative if not realistic.

And you had me fooled hat the gloves going to zero was infinite deflation until I thought about it.

That would be minus 100% inflation (100% deflation) not infinite. But really nice try.

By the way math works the same everyplace. I don’t do advanced math anymore, but I love investment math. Percentages and compounded returns. There is no opinion involved. No majority rules. The math is either right or wrong.

Anyhow, I presume you are still busy looking at the massive inflation data from Statistics Canada at the link I gave. You can look at the weights on hundreds of components and also the inflation data going back to 1914 by hundreds of components.

https://www150.statcan.gc.ca/n1/pub/71-607-x/71-607-x2018016-eng.htm

They give you graphs and annual percentages and data. A gold mine for anyone interested in exactly how CPI is calculated.

#122 IHCTD9 on 04.15.22 at 12:22 pm

Just read Jen’s article and breezed thru a few other ones she wrote. She’s got the economics of housing down. Same with the fiscal policy end. She does see the forest. I’ll chalk up the Boomer comments as click bait and an opportunity to have fun with English. It’s her most commented article.

You could sum up the article by saying Canadian RE will never return to normal by the hand of any Canadian. It’ll have to be an outside force. People will have to fear homeownership for one reason or another.

Keep your nose to the wind dogs.

#123 Shawn on 04.15.22 at 12:23 pm

#88 Left GTA on 04.14.22 at 8:26 pm

I get what some of these millennials are complaining about but I also still do not get it.

****************
Great post about the more frugal and spartan lifestyles of the 1970’s.

Anyone who does not understand that young people today ahve a massively better standard of living than people did in the 60’s and 70’s clearly is not old enough to know what life was typically like back then.

The Moms with four kids and no dishwasher and no house cleaner who was lucky to see the inside a restaurant once a year is said to have “not worked”. Hilarious. One vehicle was typical and Dad took that to work so Mom was stuck at home. She also typically made all the meals even on vacation which was camping or at best in a travel trailer. Life may have been healthier but it was quite a bit harder on average.

#124 Shawn on 04.15.22 at 12:31 pm

Fast Food in the 1960’s and 70’s

If it existed at all, that was when Mom made something fast us six kids,

We were far better off than most. Fast food outlets only came into Nova Scotia about 1970 and it was a rare treat for the first ten years at least.

On road trips virtually no one bought anything other than gasoline at gas stations. They had a few bottles of pop and bags of chips for sale but typical people never bought any. There was no fast food outlets attached, that’s for sure.

#125 Wiser Words on 04.15.22 at 12:42 pm

#78 Quintilian on 04.14.22 at 6:58 pm

Some people have enough conviction to state clearly what they believe.
Others have a compulsion to straddle the fences.

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

“The fundamental cause of the trouble is that in the modern world the stupid are cocksure while the intelligent are full of doubt. Even those of the intelligent who believe that they have a nostrum are too individualistic to combine with other intelligent men from whom they differ on minor points.”

-Bertrand Russell, “The Triumph of Stupidity” (aka Canada)

#126 Why So Bitter? on 04.15.22 at 12:58 pm

#116 Sail Away on 04.15.22 at 9:51 am
#97 Ustabe on 04.14.22 at 9:34 pm

Go easy, its obvious our resident narcissistic sociopath is on a new pharmacological regimen. They must be still doing some work on dosages is all. Hence the obsequious, smarmy good guy posts, one after another, of late.

———-

I fail to see relevance of your comment to the topic at hand; it almost feels like a purely gratuitous insult?

Seems sorta low class.

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

Seems like someone in a lot of pain. Probably explains his fixation with meds, maybe his aren’t strong enough.

I think he’s just upset someone is beating him at his own “I’m a saint” humble-brag posts and isn’t biting on his armchair-shrink taunts.

Sorry Ustabe, but your true character comes out in the pointless insults.

#127 Doug in London on 04.15.22 at 2:47 pm

@CjohnC, post #85:
Good points you make. It does take a lot more energy to make an electric car than an equivalent gasoline fueled model. An electric car really only makes sense environmentally and economic sense if you drive a lot more miles per year than the average person. The sensible way to go would be to have a less car dependant society, but that’s not likely to happen any time soon. We’ll end up substiting gasoline fueled cars with electric and the problems with them. It’s like breaking a heroin addiction by using opioids instead. Add to that they cost more so affordability could be a problem. Last but not least, how well will they perform in a cold Winnipeg or Saskatoon winter?

#128 Doug in London on 04.15.22 at 2:54 pm

@Left GTA, post #88:
You make some valid points. I was born in 1960 and, while we didn’t live quite efficiently as you did, we lived well within our means and not with the excess we see today. Yes, I’ve also wondered why houses are bigger now than those built in the first half of the 20th century while family sizes are smaller. I also think a lot of these Millenial buyers are less averse to debt than our generation. They have no memory of what happened in 1981 or 1990.

#129 Phylis on 04.15.22 at 5:51 pm

#123 Shawn on 04.15.22 at 12:23 pm Ahem, a mom with four kids and four dishwashers.

#130 Danny on 04.15.22 at 7:20 pm

Dale, I am in a very high income earning career and all I do is save in GICs, term deposits, RRSPs, TFSAs for myself. My house is all paid off and have no debts. I am half way through my long term plan of $10 million, $5 million in many financial institutions working with many deposit/GIC brokers so all within deposit insurance limits, CDIC, provincial deposit insurance, Assuris. I am 40 and I will probably be retired from my career in my 50’s.I might partner with someone else and do a business venture when I am well established.

#131 OwlEyes on 04.15.22 at 11:01 pm

Thank you so much for sharing the Boomer secret of eternal youth! Are there candles involved in the millennial juicing ritual?

#132 Brutal on 04.16.22 at 9:47 am

@#40 Shirl Clarts on 04.14.22 at 3:51 pm

^^^^^^^^^^^^^^^^^^^^
Here are some Winnipeg standards. Alright, slightly above. No MDF mouldings or IKEA in this place!

https://www.realtor.ca/real-estate/23760800/1063-wellington-crescent-winnipeg-river-heights
__________________________________

Bwhahaha. A mansion in a shit hole is still a shit hole. Lipstick on a pig. “Oh I can’t wait for my vacation to Winnipeg!” Said nobody ever.

You do know why it’s called “Winterpeg” right? Paying $3 Mill to freeze to death. Genius!

Clearly you’ve never travelled anywhere. Must be a Boomer. Keep your Winnipeg “standards” to yourself. I don’t want your life. So sad.