The Candidate



“All you do is give false hope to houseless, you self righteous, know it all arrogant and selfish prick.” – GreatFool blog comment on Garth Turner


With praise like that from realtors, who needs awards? Not this pathetic blog, which is staggering towards its fifth anniversary. In that time there have been 1,301 posts (the equivalent of 16 books), and 209,400 comments. Just under 5.5 million visits a year happen, but the real measure of success is the secret file I keep of obscene, ad hominem and up-yours-Garth comments.

Last year it ran to 218 pages, single-spaced, 10-point type. The year before was a disappointing 136 pages. So far in 2013 (and it’s only mid-February), we’re at 41. Meanwhile at least two of the four people I’ve thrown off this site have started their own anti-Garth blogs. I am so proud.

Why just a couple of weeks ago, the last abusive realtor I punted left me such a nice email: “You think you are punishing me?!? LOL. Geez it’s a blessing to be banished from the lost cause, black hole of this pathetic blog. Something I should have done myself long ago. I gladly leave you Garth to bask in the worship of your loyal pack of ass kissing, ball licking hounds. Look at your audience my friend… is their worship really such a compliment? Don’t you think you could do better?”

While I know it’s hard to top this kind of attention, I have been asked to try.

Jeremy Biberdorf runs a financial blog which likely has fewer babes and more creds. But it also has a kind of contest. “On the recommendation from several readers I have included your blog in my poll for the top Canadian finance blogs,” he writes me. “It would be great if you could share this with your readers on your website or on social media to encourage them to vote.”

While I suspect this is a fancy ploy to get more traffic flowing to his site, I’m game. So if you want to cash your ballot for GreaterFool, as opposed to one of those candy ass, pay-down-your-mortgage and put-money-in-a-jar blogs where nobody calls the host a prick everyday, then go here and vote. Remember, do it often.

Well, not one day after our collective hissy fit over media manipulation by realtors in Vancouver, come two fresh examples of how the nation’s routinely misled when it comes to real estate market analysis. Here’s CREA, for example, doing clumsy damage control in the wake of housing stumbles in Toronto and Vancouver. The new media release talks of “house sales picking up steam” in both cities, then compared January with December, citing a 5% sales increase.

And while it’s true more houses sold last month in the GTA, for example, than in December, the stat is meaningless. That’s because this past December’s sales were 22% lower than the same month a year ago. By the way, January 2013 sales were also lower than those in January 2012. Trying to speak through the feet in his mouth, CREA president Wayne Moen said, “Improving sales in Vancouver and Toronto likely come as something of a surprise to some.” Especially the honest ones.

Meanwhile, not content with letting real estate marketers lie to it, one media outlet has decided to join the fun. After all, making up the news is so much more efficient than actually looking for it.

“Headlines regularly tell people that Vancouver is among the least affordable cities in the world,” the Van Sun says. “But often they don’t tell the full story — that while the city of Vancouver is a pricey place to be a homeowner, the suburbs still have home prices that are affordable to most families.”

That’s right. Banish those thoughts that a city where average detached homes cost $1 million and most families earn $83,000 is unaffordable. The Vancouver Sun just joined forces with the Urban Development Institute (a.k.a. “developers”) and FortisBC (which sells energy to homeowners) to create a “Housing Affordability Index.”

The conclusion: “As a region, the numbers aren’t bad.”

Yeah? According to the index, only 51% of people can afford a condo in a concrete building and just 40% can afford a SFH out in the burbs. In Van city the proportion of families affording  payments drops substantially, to 32%. So not only are 70% of the people who live there unable to afford monthly payments, but this is based on carrying costs after a 10% down payment by first-time buyers and 35% down for those buying a detached house. As I have told you before, the average down payment in Canada is now 7%.


Now, the best part. The paper found a financial advisor (Adrian Mastracci, portfolio manager at KCM Wealth Management) to give its readers advice.

Mastracci said most people have to start with a small condo and whittle down their mortgage to build up equity. “Plow any extra money you have against your mortgage and really go to town,” Mastracci suggested. “That is a risk-free investment you can make.”

Maybe somebody should tell Mr.M that condo sales have plunged 19% in the past year and prices have fallen 6%. That means this asset is becoming more illiquid as it declines in value. Add in transaction costs, and the same condo has lost 9.2% in a year.

If that’s “risk-free,” what does KCM stand for? Kan’t Count Money?

Say, have you voted yet?

avatarGarth Turner - The Greater Fool posted Friday, February 15th, 2013.

1 Comment for “The Candidate”

  1. I like your blog and read frequently. I just wish you would consider that people who quickly pay down
    mortgages may be doing the prudent thing. Financial asset are priced off interest rates which are artificially
    low. Even preferred shares can experience corrections. At this point people have the opportunity to be debt free before mortgage servicing costs increase dramatically. At this point 5% prime would be dramatic.

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