Doomer porn

Doomer porn is everywhere.

The Iran war’s going nowhere and a global energy crisis is growing. Trump is more unhinged daily. Poilievre says you live in then worst country in the G7. Inflation is up. Mortgage rates are creeping.

And look at stories like this, making headlines:

Canada’s largest condominium market has “hit bottom” as first-quarter sales for new projects in Toronto fell 52 per cent from a year ago to a 35-year low, according to an Urbanation Inc. report, and no projects were launched for the first time in three decades in the period.

Seriously. The largest new-home construction market in Canada and, for many years, the busiest in North America – now without a single new project being launched. Meanwhile house prices have been going down for four years. We’re back to pandemic values in many places.

Sentiment sucks. Unemployment is rising. The economy is barely growing. AI will probably come and eat your job. We’re just about to go into a fresh, new big fight with the Trump dudes over our trade agreement. And they hate us. Yikes.

Welcome to your first adult crisis.

Well, if this is your first adult financial crisis, you deserve some sympathy. Humans have a weird innate desire to think they live in the worst possible times, and are hapless victims of circumstances. They want to believe crap like this has never happened before. They’ll even listen to those who say we’re in structural change – capitalism is failing, the American empire is collapsing, the fiat money system is ending or that generational revolution is at hand.

Of course, it’s all bunk. You learn that over time. Crises come. They go. Life swerves or yaws, but it goes on basically the same.

Those who lived through the 1987 crash, Y2K, the dot-com massacre, Nine Eleven, the credit crisis, wars in Iraq and Afghanistan, Covid and Trump get it.

This real estate correction is a part of that. It’s not opening a new chapter. House prices are not rewinding to 1970s levels. In the absence of a national and global depression, replete with deflation, cascading asset values and mass unemployment, this is a period in which past excess is wiped away so that value emerges.

It’s good. It’s healthy. And those who see it as opportunity, not the End of Days, will benefit.

Something else to remember: real estate markets can advance well on thin trade. Prices can rise. New benchmarks set. Sentiment change. Average people do not need to afford average houses for average valuations to increase. Not after years of correction in which sale prices dropped by about a third. That is the case precisely now.

The evidence is anecdotal, but consequential.

In the last two weeks showings have increased dramatically, offers are more plentiful and bidding wars are a thing again. Not for condos – where the descent continues, albeit more slowly – but certainly in the detached segment.

Here’s an example. Yes, it’s extreme. No, it’s not a one-off.

The so-so house in a good hood was listed aggressively for $1.9 million. It has four bedrooms, three baths and a garage. The place was built in 1905, recently renovated, and sits on a skinny 24-foot lot. It just sold in a day for $1 million over asking.

Outlier?

“I have most definitely seen a spring fling of offer dates and sale prices over asking,” says veteran agent Carly Weisz. “That being said, the sale prices are still lower than last year and the year before. What I will say – it is a good time to buy if a buyer has been on the fence and that’s 2 decades of experience talking!”

The stats over the next couple of months will probably surprise the doomers. Despite the hellish headlines, life carries on. Human nature has not changed. It won’t. People crave security and stability and will not stop wanting an owned home. Others who understand the financialization of real estate see a commodity everybody wants trading at a 30% discount with lots of inventory and reduced competition. They move in. They always do.

If you can’t afford to buy, for Dog’s sake, don’t. But if you can, waiting is probably a bad strategy.

You’ll learn something, though. We all did.

About the picture: “Hope you Dorothy are doing well,” writes Vittorio. “It’s your favourite Italian, and my door is alway open when you decide to  travel to Cambridge. Just letting you know that your advice is travelling to the next generation.  My adult kids (27 and 25) are off the payroll and debt free.  They live within their means and save.  Thank you for all you do. Here’s our departed Cody who will forever be in our hearts.  It would be greatly appreciated if his picture will someday be on your daily advice.”

To be in touch or send a picture of your beast, email to ‘garth@garth.ca’.