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Since I am the bearer of bad news, I was just wondering why on earth would anyone buy a house/condo NOW? Has anyone looked and shiller's graph? We are heading for a collapse in Real Estate in CANADA. We are NO different than the USA. We actually have higher unemployment per capita than the US! We have just started and will be spiraling down along with the economy for a couple of years REGARDLESS of what anyone says. Read up: http://www.thecomingdepression.blogspot.com
You may want to view Garth Turners Blog Real Estate stats and the comments
:confused:
 

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Not sure if this is just annoying spam, a forum troll or serious discussion?

I think the question should be, "why on earth did anybody by a house/condo 2 years ago at the peak?". To be honest, I am shopping for my first mortgage and first condo. I am employed, prices are down, and rates are at all time lows. In 30 years I may be asking "Why DIDN'T I decide to buy?"

Also, keep in mind that unemployment data is calculated differently in the USA vs Canada, don't just take the government's figures at face value while doing a direct comparison. It's not all apples out there.
 

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Discussion Starter #4
Not sure if this is just annoying spam, a forum troll or serious discussion?

I think the question should be, "why on earth did anybody by a house/condo 2 years ago at the peak?". To be honest, I am shopping for my first mortgage and first condo. I am employed, prices are down, and rates are at all time lows. In 30 years I may be asking "Why DIDN'T I decide to buy?"

Also, keep in mind that unemployment data is calculated differently in the USA vs Canada, don't just take the government's figures at face value while doing a direct comparison. It's not all apples out there.
You're not serious are you? The unemployment rate is applied "differently"?? Do you honestly believe we are better off because the Gov't stated we are? "This is Different here".. YOU seriously believe that this is a recovery? Thats FUNNY. Like everything goes up and never goes DOWN? Are you living on MARS? Prices aren't down. They are COMING DOWN. They will be down 50% from the price you are buying today. You may want to do some massive research on the economy and whats coming. You can start with our banks, The derivative exposures of each one is an EXCESSIVE of ONE TRILLION DOLLARS. You have been programed to believe that this downturn has an upturn. It does NOT. It will take YEARS-10-15 years before we see the values of today.
 

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wow, might want to simmer down a bit chicken little. If the entire system crumbles then the money you're making off those depression survival kits will be worthless. Good luck with that.
 

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Hmm, actually a pretty good idea this guy has! He fans the flames of fear, drawing readers to his chicken little site, where he probably gets lots of people buying this 'survival kit' (that probably costs him nothing, or next to it). The more he spreads fear, the more sales he probably gets, so he has a vested interest in stoking that fire. A nice opportunistic play on current times.

I'm a bit jealous, wish I'd thought of it! ;)
 

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You're not serious are you? The unemployment rate is applied "differently"?? Do you honestly believe we are better off because the Gov't stated we are? "This is Different here".. YOU seriously believe that this is a recovery? Thats FUNNY. Like everything goes up and never goes DOWN? Are you living on MARS? Prices aren't down. They are COMING DOWN. They will be down 50% from the price you are buying today. You may want to do some massive research on the economy and whats coming. You can start with our banks, The derivative exposures of each one is an EXCESSIVE of ONE TRILLION DOLLARS. You have been programed to believe that this downturn has an upturn. It does NOT. It will take YEARS-10-15 years before we see the values of today.
1. I do not believe any government simply because they tell me some information. It is a good starting point but in order to get the full story you have to look deeper into the data. Anyone can make a chart look any way they wish, and simply yelling that it will continue this way forever makes you no better than those who thought +30% returns would happen ad infinitum.

2. I suggest you take some critical thinking courses and learn more concise methods of argumentation. A good start for you would be "Appeals to the Extreme".

3. Do I believe this is a recovery? No. That may not even happen for 5 or 10 years as you said. Being 25, I have no reason to panic. In the same respect, If prices drop another 50%, it will simply be another great opportunity to buy, even more so than today.

4. Studying the economy? The parchment on my wall gives me some confidence that I have this one covered. So check.

5. Bank exposure? Fine. CDIC FDIC etc tells me no need to run to my bank. Unless you have dropped the dollar as currency altogether and are now accepting canned food as legal tender in which case I have a can of beans here that would like 5 of your kits.

See you in 15 years.

Cheers.
 

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Discussion Starter #8
1. I do not believe any government simply because they tell me some information. It is a good starting point but in order to get the full story you have to look deeper into the data. Anyone can make a chart look any way they wish, and simply yelling that it will continue this way forever makes you no better than those who thought +30% returns would happen ad infinitum.

2. I suggest you take some critical thinking courses and learn more concise methods of argumentation. A good start for you would be "Appeals to the Extreme".

3. Do I believe this is a recovery? No. That may not even happen for 5 or 10 years as you said. Being 25, I have no reason to panic. In the same respect, If prices drop another 50%, it will simply be another great opportunity to buy, even more so than today.

4. Studying the economy? The parchment on my wall gives me some confidence that I have this one covered. So check.

5. Bank exposure? Fine. CDIC FDIC etc tells me no need to run to my bank. Unless you have dropped the dollar as currency altogether and are now accepting canned food as legal tender in which case I have a can of beans here that would like 5 of your kits.

See you in 15 years.

Cheers.
So your 25 years old. I am 49 have owned multiple businesses, travelled the world, met and talked with multi billionaires, owned 52 houses, lived in Mexico, USA and 7 cities in Canada. I am related to an individual with close ties to an Ex President of the US ( they are best friends). This person explains the economic situation that cannot and will not be written about on this blog or any blog. I would be flung into a river, I think, if I did.

I only set up this website so "KIDS" like yourself can learn something. The "little kits" are something I offer to the public to get a small token for keeping people informed. I make NO MONEY on this site WHATSOEVER.
Your parchment on the wall is just that, a piece of paper learned at school by a professor rather than the REAL WORLD. Go read the book "When Giants Fall" this will give your "parchment paper" credibility. I don't care if you people believe a word of anything that is stated here, as this will be my LAST POST. Good luck with your "dreams".
:cool:
 

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The only reason to buy home now is:
1. You discover a great cash-flow positive deal
2. You want to live in the home for a long long time

My wife and I are wrestling with both...
 

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Hey, ...depression, I share some of your pessimism about RE and I, too, read Garth Turner, but I don't think you're really helping your case with all the heavy breathing and hyperbole. Even Turner, who's so bearish I'm surprised he doesn't hibernate during winter, isn't making the catastrophic claims that you are.

That said, I do agree that the uptick in RE sales this spring is probably a false dawn and that house prices are likely to remain depressed for several years to come.
 

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This is one of the funniest things I have read on the net in a week. With much love for Monty Python and Douglas Adams (R.I.P.)...

So your 25 years old. I am 49 have owned multiple businesses, travelled the world, met and talked with multi billionaires, owned 52 houses, lived in Mexico, USA and 7 cities in Canada. I am related to an individual with close ties to an Ex President of the US ( they are best friends). This person explains the economic situation that cannot and will not be written about on this blog or any blog. I would be flung into a river, I think, if I did.
Bah, that's nothing. I'm 285 years old, I've owned hundreds of businesses, travelled the galaxy, and met and talked with every person, living or dead, who had ever had a billion dollars or more. I own 87 houses (or maybe 88, I'm not entirely sure how many houses I have), lived on every continent on the planet, including a year in the arctic at the North Pole after saving Christmas from the Grinch. I am related to God, and a cousin who's a transvestite hooker in Los Angeles, but we don't talk about him. I know the secret to life, the universe, and everything, but if I even consciously think about it everything we know would cease to exist and it would all start over again.

But try and tell that to the kids these days and they don't believe you.
 

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I wonder if the kit includes the rules and a how-to on surviving battle in the thunderdome. Break the DEAL, Face the Wheel!!!!

Oh!!!...maybe the kits also come with their very own Master blaster with knowledge on how to utilize methane gas.
 

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PS: With much respect for Garth Turner, who I enjoyed having as an MP and I honestly feel mostly believes his warnings (he does get carried away a bit with hype and quickly explains away any of his actions which don't match his words... such as not resigning before joining the liberals, or buying a foreclosed investment property that is a good deal while warning everyone else to sell and rent because there are no good deals out there)... I always remember this particular exchange when I think of him providing bankable advice, from Rick Mercer's blog:

“If you own Nortel, or a mutual fund holding it, don’t bail out now… If you do not own Nortel, then this is the time to start accumulating it.”

- Garth Turner, Conservative candidate (Halton) November 27th 2000 at the start of the stock's plummet from $50 to pennies a share

“I am constantly amazed at the assumption people make that they can manage their own finances… most people can’t. They don’t have a clue how to pick stocks.”

- Garth Turner in a 2002 personal investment column regarding those unfortunate enough to have lost on Nortel
 

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Funny

Stephen Heath,
This is the best response I have heard in a long time. I laughed and laughed and laughed. Nice one

This is one of the funniest things I have read on the net in a week. With much love for Monty Python and Douglas Adams (R.I.P.)...



Bah, that's nothing. I'm 285 years old, I've owned hundreds of businesses, travelled the galaxy, and met and talked with every person, living or dead, who had ever had a billion dollars or more. I own 87 houses (or maybe 88, I'm not entirely sure how many houses I have), lived on every continent on the planet, including a year in the arctic at the North Pole after saving Christmas from the Grinch. I am related to God, and a cousin who's a transvestite hooker in Los Angeles, but we don't talk about him. I know the secret to life, the universe, and everything, but if I even consciously think about it everything we know would cease to exist and it would all start over again.

But try and tell that to the kids these days and they don't believe you.
 

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Comindepression....can you source your information? You state that each of our banks has exposure to one trillion dollars worth of derivatives. Do you have any idea how big a trillion is. And EACH of our banks has exposure to a TRILLION dollars worth of derivatives?
Perhaps you are right. I'd just like to see it from a credible source, and not one of your fellow bunker-dwellers. If you are right (and I doubt it), that would be down right terrifying.....

As far as Garth Turner goes, I would say don't attack the man, attack the message. He may have been very wrong in the past, but I do believe that he is right about the coming (ongoing) real estate decline. I would love to hear someone present a realistic scenario that outlines how real estate will go anywhere but down over the next few years.

The only factor that drives SUSTAINABLE growth in real estate value is wage price inflation. PERIOD! Someone please outline how we will see aggregate wage price inflation in the coming years, barring a massive episode of hyperinflation.
And even if hyperinflation hit, what would that do to interest rates? They would shoot higher to protect the value of the dollar, crushing RE values further.

I think Turner is right on this one. Wait until August when supply again massively outstrips demand and we will see more significant price declines in RE values.
 

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This is one of the funniest things I have read on the net in a week. With much love for Monty Python and Douglas Adams (R.I.P.)...



Bah, that's nothing. I'm 285 years old, I've owned hundreds of businesses, travelled the galaxy, and met and talked with every person, living or dead, who had ever had a billion dollars or more. I own 87 houses (or maybe 88, I'm not entirely sure how many houses I have), lived on every continent on the planet, including a year in the arctic at the North Pole after saving Christmas from the Grinch. I am related to God, and a cousin who's a transvestite hooker in Los Angeles, but we don't talk about him. I know the secret to life, the universe, and everything, but if I even consciously think about it everything we know would cease to exist and it would all start over again.

But try and tell that to the kids these days and they don't believe you.
Please keep this a secret, but it was I alone who created all. Amen
 

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As far as Garth Turner goes, I would say don't attack the man, attack the message. He may have been very wrong in the past, but I do believe that he is right about the coming (ongoing) real estate decline. I would love to hear someone present a realistic scenario that outlines how real estate will go anywhere but down over the next few years.
To be fair, you are talking about a prediction, and like it or not, the success of past predictions IS a statistical indicator of the likelihood of current predictions being accurate.

As for a realistic scenario, let's use Garth's prediction that to return to the historical mean, another 10-15% drop is required. IF that were 100% accurate and IF that were to happen this year, then the exact same model that is predicting this drop is predicting subsequent years of price increases and the best time to buy would be as soon as the bottom was hit.

Also, don't forget a prediction has to be useful to have any meaning. His warning to sellers was useful in it's day, now it is buyers that need him to give them a heads up... but Garth is an incredibly entertaining writer and has committed to writing daily, whether there is something new to write about or not. Thus, in a sense, he's the opposite side of the coin of HGTV in the boom haydays... if they were real estate porn, he's apocolypse porn. And I think it's very telling that he is still telling people to stay away from real estate, period, even though he himself picked up an investment property that was a power of sale bargain... why isn't he telling people that most real estate is still overpriced but the odd gems are out there? Is it because that message wouldn't play to the audience he has built up that are 100% negative, and that his real purpose is to preach to his flock?

Don't get me wrong, I actually visit greaterfool and read the comments almost daily, although part of the reason is to enjoy how condescending and insulting he can be at the people that ask stupid questions (something I have to put up with while wearing a smile at work), and if I were buying or selling, I would definately think hard about some of the things said there, but I would also do other research... see what is actually moving in my neighborhood and why, look at my budget, etc. After all, if my house today could sell for $300,000, and a dream house in the perfect location were available for $400,000, then waiting for the bottom to hit would save me at most $15,000 (assuming both my current and new house went down that 15%), but that house might not be available then... or alternately, if I miss the bottom, it may actually cost me more to move to my dream location in the long run. Much like some people will pay a premium to have fixed rate security instead of going with a variable rate, others might be willing to pay a premium for a very specific property. I just don't believe there is a single hard and fast rule like Garth does, and while listening to his advice might be the right thing for many people, it also might be the wrong thing for some. We are not all the average, and anyone that tells you he has the solution for everybody is guaranteed to be wrong, because if everyone is a seller, then noone is a buyer, and you need both for a transaction.
 

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As for a realistic scenario, let's use Garth's prediction that to return to the historical mean, another 10-15% drop is required. IF that were 100% accurate and IF that were to happen this year, then the exact same model that is predicting this drop is predicting subsequent years of price increases

Wrong. You are assuming that we are currently at fair market value and that the massive price appreciation of the past 10 years was justified based on wage inflation. If this was the case, then yes, any significant decline would be followed by a reversion upwards back to the mean. However, when average price to average income is currently over 4 (while historical average is slightly over 3), prices are clearly NOT justified and the downward pressure we will continue to see on RE prices is a reversion BACK to the mean, not an over-correction.

Garth is not the only one predicting significant price declines. As far as basing current predictions on past record, that's like saying that guys who have been absolutely bang-on so far are most likely to be right going forward. So you must be worshiping a guy like Peter Schiff, who has been amazingly accurate and also continues to push gold. Is your portfolio 100% gold???? I would doubt that. The point is that it doesn't matter someone's past record. Can they justify their position based on current research? If so, they are worth listening to. If not, who cares about them.

So again, I restate my question: Provide a realistic scenario that has house prices rising in the next few years. Really....think about it. Not gonna happen.
 
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