Sunday, March 30, 2014

Observations on Toronto and Canada

After a visit to Toronto, Ottawa, and Montreal, a few observations on personal finance:

  1. Toronto is clearly in a housing bubble, but the question is how does it get deflated. Evidence for a bubble?  Buyers are taking advantage of historically low interest rates to load up on housing and other household debt with no safety margin.  Rented condominiums cannot pay back the landlord's mortgage, let alone deliver a profit.  Silly actions abound such as manufactured bidding wars, people writing "love letters" to the home seller, and making bids on 100+ year old houses without a condition of inspection.  Let's hope the bubble is deflated through stagnation of prices over an extended period (5+ years) rather than a US-style crash.
  2. Food is affordable in Canada but booze is still expensive.  Coffee at Tim Hortons, the national coffee shop chain, is a particularly good value.  Just remember to say "double-double" the same way you would imitate a turkey call "gobble-gobble".
  3. Taxi fares are outrageous, particularly in Ottawa.  A 10 mile ride to the airport in an old smelly cab was $48C ($44US) with tip.  In Northern Virginia, our 12 mile ride in a rather new cab was $34US with tip.
  4. Train travel in Canada is still a good value.  The train from Toronto to Ottawa was quite reasonable.  However, Union Station during rush hour is frightening as you always feel like you are going to die in a stampede of GO Train commuters as they rush through the station on the way to the subway.
  5. Montreal is the same as always - bad roads, good food, silly politics, and bad weather.  Where else but Quebec can a government pass a law to combat gender discrimination by legalizing religious discrimination?

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