It’s been a while since my last post, and I thought it was time to get back into the swing of things now that summer is coming to an end.  This is the time of year when kids start to grumble because it’s back to school.  Parents are running around buying back to school clothing.  Summer homes will be visited less frequently as we move into September.  In no time we’ll be digging out our fall clothes, and giving our winter jackets a second glance.  The end of summer usually brings on a touch of melancholy.  Summers are supposed to happy and fun filled months.  I’m not sure if the summer of 2013 will looked upon with any degree of fondness.   My memories of this summer will be of the devastating floods in Alberta, the loss of life in a terrible train explosion in Quebec, Mother Nature wreaking havoc in Ontario, and the freighting thought that a country in the Middle East may have used chemical weapons on their own citizens.  The summer of 2013 was filled with fun, sun and madness. 

Comparing what we’re experiencing in our industry to that of mother nature’s destructive powers, and geopolitical issues, seems inconsequential.  Theoretically it is, but when livelihoods are impacted the challenges are real.  Over the summer of 2013 we’ve seen a steady rise in interest rates.  Since April of this year, interest rates have risen by 80 bps.  Normally that would have caused howling from the hilltops.  But there’s nothing normal about this summer, thus the muted commentary about rising interest rates.  This is the summer where we had to accept the fact that we have a liquidity issue, not a crisis, yet.   This is impacting everyone, borrowers, brokers, the oligopoly and smaller mono-lines.  This is the summer where the self-fulfilling prophesy may have turned into reality.  Condo prices appear to be contracting, while the average price for a single family home is on the increase.  Condo sales are down 34% below their 10 year average.  No one should be surprised by this.   When mortgage rules are tightened, first time home buyers are impacted the most.  The point of market entry for first time home buyers is now further from their grasp.  First time home buyers fuels the entire real estate market.  Impact them, and you’ve impacted the entire market.  There are those who are now predicting that two very distinct market sectors are a way of the future.  Sales and price for single family homes will be very different from the condo market.  Owning dirt is always preferable, and will be even more so in the near term. 

Our industry is very fluid, and constantly changing.  We’ve seen numerous changes during the summer of 2013, and we should expect more.  In the same fashion we expect a change in seasons.  Good riddance summer of 2013.

Enjoy the long weekend.

Until next time

Cheers

Well, not really. I think I would rather watch eight hours of Degrassi reruns in a row than go fishing. My family, friends and acquaintances who enjoy fishing are rolling their eyes right now and thinking: “this coming from a guy who spends hour after hour trying to get a little white ball to fall into a ridiculously small hole. And all the while offering profanity-laced commentary.” To that I say, whatever! My aversion to fishing is that it’s too exhausting. You’ve got to cast the line, open a beer and take a seat. Whew! I’m fatigued just thinking about it.

All kidding aside, I’m off for a family vacation for the next couple of weeks and I actually might go deep sea fishing. We’ll see. Therefore, blog posts may come sporadically or not at all over the next couple of weeks. It will all depend on whether something funny as hell happens while we’re on vacation. Which usually happens in our family.

I thought a fitting way to end the week was to comment on a recent phenomenon happening here in Ontario. Not sure if it’s making its way to other parts of the country but I hope it does. It’s about random acts of kindness and by all accounts, it appears to have started in Ottawa. For some reason it all centers around coffee. Last week a man walks into a Tim Horton’s coffee shop in Toronto and asks the cashier how much would it cost to buy 500 medium cups of coffee. The response was $825. He pulls out his wallet, plunks down $825 and says “I’m buying the next 500 cups of coffee.” He then walks out of the coffee shop without giving his name and he didn’t bother to wait for the people standing in line behind him to say thank you.

More of these stories are coming to light and I think it’s so cool. Not many can afford to drop $825 worth of coffee on total strangers but one cup of coffee every now and then? I think so. But what is really cool is how these random acts of kindness generate stories. The recipients of the free coffee will tell at least one person about what happened to them that day. How many of us can say that we did something so selfless and kind that at least 1000 people are talking about it? So I tried it this morning, on a very small scale. Every street in downtown Toronto is being dug up, resulting in brutal traffic congestion. I work at the corner of Bay and Richmond and a portion of Richmond is closed due to road work. There are two police officers monitoring the intersection and as I walked by them today I said, “gent’s, I’m just on my way to Tim’s, can I get you a coffee?” The police officers were most gracious but declined. And I walked away feeling a little better because I made the gesture and I also know that I just created 4 new stories about simple kindness.

Until next time,

Cheers

Do my eyes deceive me? Is there a plethora of solid economic news? Let’s see, there aren’t any new weather disasters or heat waves to be concerned about which would impact housing. Well, that’s a start. Add that to some positive economic news and I’m almost afraid to continue on with the blog. What the hell, I’ll tempt fate. There’s some positive news coming out of Canada and also for our neighbors south of the 49th parallel.

The results of the most recent Thomson Reuters/University of Michigan U.S. Consumer Sentiment Index has reached the highest level since 2007. Given what happened in 2008, the near collapse of the global economy, these results are significant. The strength and weakness of the U.S. economy is dependent on consumer spending. After 2008, American consumers did something awful – they stopped spending and started to save. Their levels of individual savings reached record highs, and it was a convenient statistic for doomsayers in this country to point too. The soapbox rhetoric sounded something like this: “look how responsible the Americans have become. We should learn from them.” Saving money is wise but we have also learned that if the U.S. consumer doesn’t spend, we feel it. Like right in the derriere. Our economies are intertwined so any good news south of the boarder, as it relates to consumer spending, is good news for us. We have lots to sell them and with the falling loonie our products and services are more affordable. So come on American consumers, be patriotic. Dip into your savings accounts and don’t be embarrassed about having a larger credit card balance. Spend for the love of your country and your most appreciative neighbors to the north.

The good news here at home is the average Canadian net worth is on the rise. For the first time ever we’ve topped the $400,000 barrier. Okay, most of that is real estate equity but I don’t think we should have to apologize for that. Having a balanced portfolio mitigates risk, but wealth is wealth. Kudos to the people living in Ontario. The province which proudly claims that it’s “Yours to Discover” has discovered that paying down debt is not a bad thing. Ontario was the only province to lower non-mortgage debt, resulting in Ontario having the largest percentage increase in average net worth in the country. Saskatchewan is climbing the net worth charts given their newfound riches, due in large part to natural resources and real estate value. B.C. still holds the distinction of having the highest net worth at $662k. When it comes to B.C. we all know that if you own a home, you’re a millionaire. Unfortunately, to realize any gain, British Columbians would have to sell their home and move to Nunavut. Sure, the average temperature in Nunavut in January is -48, but you would have all that cash to throw into the fireplace to keep yourself warm.

All in all some good news across the country. I don’t want to push the “good news” stories too far. The law of averages dictates restraint. I may have gone too far already. So I’ll apologize in advance if a meteor hit’s the earth (the apology only applies if the meteor actually lands in Canada) and ruins everyone’s week.

Until next time,

Cheers

I’ve been a little tardy with my posts recently. No earth shattering reason why other than life events and other priorities taking precedent. For example, last week I spent a fair bit of time contemplating the Canadian Health Care system. I did all this “deep” thinking while visiting the hospital and spending countless hours in an emergency room. I wasn’t the patient, my brother Tom was. Here’s the Reader’s Digest version.

"The only way the system will change is if we, the majority of Canadians, force the politicians into doing something."

My brother started experiencing sharp stomach pains early last week. My brother has a high threshold for pain so when he mentioned that he was experiencing pain my radar went off immediately. The next day the pain persisted and became more pronounced. I told him to go to emergency but he said: “I’m going to give it another day because I have a doctor’s appointment tomorrow. I’m sure it will be better tomorrow.” Tomorrow came and so did more pain. Off to the doctor he went. His family physician ordered an ultrasound, and upon review of the results, the doctor’s diagnosis was that the pain was probably caused by gas. He prescribed what amounts to nothing more than antacids. A few hours later I called my brother to see how he’s doing and he answered “not well.” I told him I didn’t give a damn what his doctor said, we had to get him to emergency immediately. He agreed and his wife took him to the hospital.

My brother got to emergency at 5:30pm and after a few hours the doctor treating him ordered another ultrasound. At midnight the doctor notified my brother that he wasn’t going anywhere. His appendix had ruptured and surgery would be required. We’re still not sure how his family physician mistook gas for a ruptured appendix, but needless to say my brother will not require his services ever again.

I couldn’t make it to the emergency room until 9:30pm that evening. To see my brother sitting there, I.V. attached to him, resting his head on the wall in an attempt to get relief, just killed me. I’m wired to fix things and there wasn’t a damn thing I could do. I was sitting next to my brother when the doctor came at midnight to tell him he wasn’t going anywhere because his appendix would have to be removed. He apologized and said he might have to sit in the waiting room until the morning because there weren’t any beds available. My mind started to race and I thought I would go home, get a reclining lawn chair from my backyard and set up a makeshift bed so he could get some comfort. To everyone’s relief a nurse came forward and said that she had a solution, bless her heart. She found a gurney for him to lay down on in one of the examination rooms.

Once my brother was comfortable, due in large part to the morphine drip, I could retreat to my own thoughts. Of all the voices in my head, the loudest one was saying, “how can a country with a standard of living such as ours, reduce health care to this?” To be absolutely clear, our doctors, nurses, technicians, support staff etc., do an amazing job. It’s the strain and the weight of the system that leaves medical practitioners no choice but to keep patients waiting hours for treatment and in some cases, left sitting in hallways to wait for a bed to become available. The responsibility for the state of our health care system today falls squarely on the shoulder of our policy makers. Politicians in our country do not have the courage to confront the sacred cow, better known as universal health care.

For the record (in the event I decide to enter into politics one day and someone claims that I once said that the sick should be left to die on the sidewalk because they couldn’t afford health care) I believe every Canadian has a fundamental right to health care, irrespective of economic standing. But I also believe it is irresponsible to continue on a path that will ultimately lead to a poorer standard of health care and ultimately bankrupt the system. It’s time for us to have an honest dialogue and dismiss those who always invoke the class warfare argument when this subject is broached.

Allowing for a multi-tiered health care system does not mean that the poor and indigent would not have free access to health care. It would mean that there would be different ways to distribute health care, thus relieving some of the pressure on government funded health care. A user pay system or some form of privatization will have to be a part of the solution. By the way, it’s creeping into our system already. For example, there are two private health care facilities within walking distance of my office. I know this because I’m a member of one. I pay an annual fee and that accords me the right to access a doctor, nutritionist, physiotherapist etc. I had to join because when I moved back to Toronto from Vancouver, I had a hard time finding a family doctor. Why? Offices were not taking new patients. So much for universal health care.

I’ll gladly pay, on top of what I already pay through taxes, for the ability to see a doctor. Being a member of a private health care facility does not mean I get bumped up in the queue for tests. In the last two years I needed to have an MRI and C-SCAN and in both cases the wait time was between 4 to 6 weeks. At my request the private facility arranged for the tests to be done in Buffalo, New York, at a cost of approximately $250 per test. I had the tests done within 48 hours. I would have gladly paid that sum for the ability to have the test done in my own country. Maybe I’m missing something but I think private clinics would lessen the burden on the government system, thus increasing the efficiency of care.

Our multi-tiered system is also made obvious when we look at how athletes receive treatment. Why is it the case that if I’m a professional hockey player in this country and I hurt my knee on a Saturday night, an MRI is done on Sunday, and the surgery is on Monday? Could the teams be paying for it directly? I wonder. Should we believe that MP’s, Cabinet Ministers, and the PM himself would wait 4 to 6 weeks for an MRI, or wait in the emergency room for 8 hours? Once again, just wondering.

The only way the system will change is if we, the majority of Canadians, force the politicians into doing something. A politician has two primary goals: getting elected and then getting re-elected. Up until now, doing nothing about the health care systems hasn’t cost them votes. There will be no change unless that changes.

Back to my brother, he’s recovering and doing well. Not back to normal but getting close. One thing about this ordeal is we learned about our father’s brush with appendicitis. It happened back in 1966. One night my dad was in excruciating pain. My mom called their family physician, in the evening no less, and the doctor did what doctors did at that time. The doctor made a house-call, took one look at the condition my dad was in and proceeded to escort him to his own car and he drove my dad to the hospital. My dad was operated on within an hour of arrival.

Until next time

Cheers

"Whatever your plans are for summer, enjoy and be safe...we could all use some pleasure and fun."

Canada Day and the 4th of July marks the beginning of summer. At least it does for me. I love this time of year and as a matter of fact, I wish the summer weather could last all year round. I know, the changing seasons are nice and the fall is beautiful so-on and so-on. But I would give up the beauty of the leaves changing colour for not having to scrape ice off the car windshield, shovel the driveway or layer on clothing because you have to endure minus 30 degree weather. I would have no problem going to hockey games wearing shorts and flip flops. I’ve done it many times to watch the Lightning play in Tampa. Trust me, you could get used to it.

Alas, summer is short in Canada, and I think that’s why we will all try to pack in so much over these next few cherished months. From enduring traffic for hours to reach the cottage on a Friday night to the simple pleasure of sitting on a patio somewhere enjoying a few cold one’s with friends. Whatever your plans are for summer, enjoy and be safe. As for me? It’s work and pleasure, with a good measure of pleasure. Based on the first six months of the year, we could all use some pleasure and fun. Looking forward to the dog days of summer.

Until next time

Cheers