Back in the day, when I purchased my first home to live-in; that was Miami in the early 1990s, first mortgages with rates of 8 to 9% and 9% to 10% were typical. People will have to accept the possibility that we won't ever return to 3%. If sellers must sell, home prices will have to decline, and lower evaluations will follow. Pretty sure I'm not alone in my chain of thoughts.
If anything, it'll get worse. Very soon, affordable housing will no longer be affordable. So anything anyone want to do, I will advise they do it now because the prices today will look like dips tomorrow. Until the Fed clamps down even further, I think we're going to see hysteria due to rampant inflation. You can't halfway rip the band-aid off.
consider moving your money from the housing market to financial markets or gold due to high mortgage rates and tough guidelines. Home prices may need to drop significantly before things stabilize. Seeking advice from a financial advisor who understands the market could be helpful in making the right decisions.
There are a handful of experts in the field. I've experimented with a few over the past years, but I've stuck with ‘’ Carol Vivian Constable” for about five years now, and her performance has been consistently impressive. She’s quite known in her field, look-her up.
I just looked her up on the internet and found her webpage with her credentials. I wrote her a outlining my financial objectives and planned a call with her.
I sold an apartment in Rochester and made about $250K. I was frustrated when I only earned $171 in interest from a regular savings account. After doing some research, I was advised to invest in stocks. Are these stocks a good point to start from?
While the stock market is promising and can give good ROI, expert guidance is essential for effective portfolio management so you don't get burnt out in the market as it is very volatile.
true, I have been in touch with a brokerage Advisor. With an initial starting reserve of $80k, my advisor chooses the entry and exit commands for my portfolio, which has grown to approximately $550k.
I've shuffled through investment coaches and yes, they can be positively impactful to an individual's portfolio, but do your due diligence to find a coach with grit, one that withstood the 08' crash. For me, Sophia Maurine Lanting turned out to be better and smarter than all the advisors I ever worked with till date, I’ve never met anyone with as much conviction.
Thank you for this tip. It was easy to find your coach on web. Did my due diligence on her before scheduling a phone call with her. She seems proficient considering her resume.
When the federal government steps in to boost demand, it’s usually trying to stabilize the economy in some way. The housing market is a key part of that. If they didn't intervene, things could slow down to the point where people might not be able to sell their homes, or the construction industry could take a hit, leading to job losses. But yes, I see why the idea of a "bubble" feels risky.
True, stabilizing the economy is important. But how long can they keep boosting demand? If the government keeps pushing low-interest rates or offering buyer incentives, won’t that create artificially high prices that could eventually burst?
That’s definitely a valid point. Artificially inflating prices isn’t sustainable in the long run. But the government’s role can sometimes be more about providing short-term relief and maintaining confidence in the market rather than permanently inflating demand.
It’s a balancing act. They have to be careful not to overstimulate the market, but at the same time, a sharp drop in housing prices could hurt a lot of homeowners and the broader economy
It sounds like walking a tightrope. I wonder, though, how an individual investor or homeowner could navigate all of this. Would it make sense to just sit on the sidelines and wait until the market cools off? Or would that mean missing out on opportunities?
Inflation is down, so what? Our salaries have lost value, we can purchase less and it doesn't matter that interest rates are lowering, we are still poorer than we were a few years back. We are now only losing the currency's value at a bit slower rate. Since this government took over, literally not one thing is better.
In all honesty it’s the whole west countries/occident going down for the past 10y , UK, Europe , Australia etc the only countries getting better are east of Europe, Asian and some Arabic
I pulled an example from the internet and going from 25 to 30 years doesn’t lower the monthly cost that much but what it does do is increase the amount of interest you’ll pay over the amortization by alot!! 30 years benefits the lender not the borrower.
it also benefits the seller at the expense of the buyer. Anything we do to juice the ability to pay more does so for everyone or nearly. Its like people who figure out they can afford more house if it contains and income suite, but dont get that if they cant afford more so can everyone else and thus the sale price just compensates accordingly. You just pay another 300k or so now plus the decades of interest on it, then most of these get lazy and dont actually bother to rent the place out and just eat the additional costs.
It depends on the interest rate. The lower the rate, the bigger % of mortgage payment goes to principal. This means that if rates decline significantly relative to whatever interest rate you used in your example (I’m guessing this was ~6%) the difference in payment between 25 and 30 yr amortization will increase significantly
Save the banks . Increase the CMHC insurance. Ponzi scheme desperation. Young people should just keep renting and stay away from house purchase for 36 months.
The buyers aren’t young people because it normally takes decades to save for a down payment unless you got rich parents. Most buyers are rich immigrants in their 40’s or 50’s. Most young people can’t beat the stress test.
@Observer168 I bought my house when I was 35 years old Came to Canada as a refugee. I worked hard saved up and invested in the stock market It took me 10 years to save up. I worked in Northern Canada specifically NWT. Most of you are not willing to uproot yourself and work in a remote area. I sacrificed to buy a townhouse in Fraser Valley. Best feeling ever. I love my home. ❤
As a cautious realtor, I always advise clients to avoid overextending themselves financially when buying a home. While I agree with you, Steve, that actions often speak louder than words, I believe the government's determination to stimulate the housing market poses a significant risk. The fact that over 40% of our GDP is tied to housing raises serious concerns about the potential consequences of a market correction. For now, it seems unlikely that we'll see a significant downturn. It's disheartening to see that fiscally responsible individuals are being left behind while speculative behavior is rewarded and protected by our government. This creates an unfair playing field and can lead to further economic instability. By hook or by crook should not be the way for Canadians' fortunes.
@@user-le2hu1ct4t Stagflation is stagnant wage and productivity with inflation, not deflation. I personally want housing deflation, otherwise the economy will be a never-ending grind.
@@zomgoose Yeah but what I mean is, if you have a steady income you can benefit, goods and gas are both in deflation rn and the gov only really cares about re, which they will seemingly do anything to inflate continuously. You could have a situation where many aspects of the economy are in deflation while re keeps the read above zero. Is it good for Canada? Of course not but who cares, the commoners don't make the rules.
@@user-le2hu1ct4ti think the majority of Canadians will be angry when they see stagnation or possible weakness in re prices, and everything else keeps on getting more expensive. People will not feel as wealthy with flat or sinking home equity, as the living standards and buying power are eroded away by inflation at the same time. Commodities may be in deflation right now, but the long term outlook is great. Asset classes that are already massively overvalued will struggle in a stagflationary environment. However in the US where re prices are more reasonable, there is a higher ceiling for prices to climb. So I can see a scenario in Canada where housing is weak, but everything else will keep getting more expensive. I expect to see the massive divergence between Canadian and US prices to shrink in margin. So a positive outlook for the US, but not Canada.
@@user-le2hu1ct4t The positives are there, but they are only there for the rich who can swoop in and use their capital to scoop up the assets of those who are slipping down the ladder as their income buying power is eroded. This increasing wealth inequality slowly erodes the middle class and moves more and more people down the ladder and a small, tiny, group of people benefit by concentrating their wealth.
This bubble needs to pop. Justin Trudue and Steven Harper both did everything in their power to create this housing bubble. But the can only get kicked down the road for so long before it explodes.
but pierre pollievee is going to solve the issues right. harper and turdo both didnt do shit so what makes another con pm to kick it further down the road too.
@@butwhytharum Personally? I think Pierre will kick the can down the road just like JT and Harper. As shitty as it is. The only way I see the housing sector bubble pop is if JT decides to do it on the way out for Pierre to deal with the after math. Other then that, I think no one will do the hard job to correct the housing sector because it hurts the home owners.
@@windatar6351 The only way to unwind the problem is to put tens or hundreds of thousands of people into apartments/homes built and serviced by government owned housing. This would get people outside of the pressures of the RE market which will never cool off as long as it is an investment vehicle. No matter how many homes get built and sold on the free market prices won't come down as there is enough money out there to snatch them all up (Canadian cities are too regulated to allow truly huge numbers of homes to be built). So, the only way to give people affordable homes is to circumvent the private market and provide government funded and run houses. Obviously this isn't ideal as people cannot build wealth as renters, but it could help to get people stabilized and would likely improve consumer spending and productivity mildly as lower rents would allow people to spend more on consumer goods. Or you could curtail RE investment by imposing a significant asset tax on investment properties. Say 8% per year on the assessed value real estate, with exemptions on the first two properties so people's primary and maybe vacation homes aren't effected. Apply this to RE owned by private equity and corporations as well. That'd put a pretty big hurt on the ROI for RE and crush it as an investment vehicle.
I agree with everything you say about the timing of cmhc regarding bailing out the development community. All they are doing is putting people in more debt.
As they said in the USA a long time ago don't fight the Fed. The government will keep juicing asset values so don't fight it. Buying and holding assets will always be profitable in the long run
Some are bending in front of the devil. Some are choosing the path of courage and truth. All that is gold does not glitter, Not all those who wander are lost; The old that is strong does not wither, Deep roots are not reached by the frost. From the ashes a fire shall be woken, A light from the shadows shall spring; Renewed shall be blade that was broken, The crownless again shall be king.
Capitalize gains…..socialize losses…. The liberals need to go!!!!! I don’t mind if it’s limited to home owners but we can’t let this be applied to investors.
Who will ever capitalize losses and socialize gains though? We need a real change and I don't see anyone out there with the balls to stand up to the rich who are benefitting from the socialized losses.
Unpopular opinion. If you're buying a 1.5 million dollar condo you'd better have at least $500k kicking around, maybe not just for the purpose of buying that condo but you better have that kind of money for unexpected economic fluctuations.
@@Observer168 im sure an industrial power plant next door is in demand. the building is higher than the boiler stack so all those high end units have great air quality. the shangri la in toronto is next to a powerplant.
The monthly mortgage on a 1.5 million house is 8,000 per month plus property tax, home insurance, and HOA fees (if applicable). Construction was made a sizeable part of the economy with the expectation of a 20% increase every year. Many people became rich, but we are in limbo in the long term.
Great points Steve. One last tin foil hat issue is they are slipping this in before tackling the mortgage fraud issue. Still studying the massive task of simply telling banks if a number matches on the NOA. This government has turned me in a single issue voter and that disgusts me.
Steve I've watched your video's for a few years now and while I sometimes agree and sometimes disagree with your viewpoints I do have a lot of respect for your insight. Something I'd really like to hear your opinion on is if you think these policies aimed at strengthening the demand side of the housing market is tied at all to a desire to prevent the loonie from dropping. Canada's GDP is around 20% real estate transactions and around 44% of household consumer held assets are held as real estate. I wonder if our policy makers are so insistent on propping up real estate assets because they are scared of what a housing crash would mean for the loonie, I imagine a lot of demand for Canadian debt would dry up if we had to stomach a protracted asset revaluation in a sector that makes up a fifth of our gdp and almost half of consumer assets. Also great video, I really enjoyed this one. You hit on some great points.
@@kenrichards1032 thanks. Not so much the loonie but the broader economy. So much wealth and spending is tied to housing that any prolonged downturn will be a serious drag on GDP
@@saretsky Hey Steve, thanks for taking the time to respond. I definitely agree that GDP dropping is one of the biggest metrics at risk in the event of a Canadian housing downturn; also agree that there are broader economic impacts that don't get considered particularly Canadian lumber and steel prices as construction slows down. I guess in my mind GPD is somewhat loosely correlated to bond markets and if Canadian GDP started taking a seriously hit I'd start to worry about what that means for demand in the Canadian bond market. Canada's economy is in a uniquely intermingled state though and its hard to really predict what dominoes will knock over what.
4 years ago, at the start of the pandemic, Tiff said, "interest rate is gonna stay low for a very longgggg time, if you need to buy a house, etc". Now that the BoC has learned its mistake, it's the Fed's turn.
Question: if you are over leveraged to pay for your 1.5 million mortgage. What will be left for you to build a retirement fund? Food, clothing, transport costs ?
Depends on where you live, Ie. In BC even if you are over leveraged on your home, if you can continue to pay it off over 30 years, you will have a 6-12 million dollar property over that time (bc tens to double housing prices every 10-15 years). If you live in a different part of Canada, it's more like double every 15-3)25 years. For me, I have seen my property investments go from 125,000 in 2010 to 2,300,000 today. Just make sure you own a home for an asset rather than a place to live. Rent out the basement, use the equity to buy a second rental property, whatever you can do to make income off your home will benefit you in the long run, not to mention the tax advantages to writing off such a high debt load.
@@SydSengotta which is all well and good but less likely to continue into the future. Its like looking at a killer stock which performed over the last year or 5 or whatever. If it crushed it then its less likely to crush it in the future as the price is already up. Its cool your p;ace went from 125k to 3.3M but i'll bet you it doesnt make the same gains over the next 14 years. Someone who doesnt own right now has to decide do they buy a house for 2.3 and expect it to be 8M or whatever or do they invest elsewhere? maybe something less risky, more diversified
@@RainCity3rd if you look at an ETF in the stock market it consistently gives 10% per year (averaged). Likewise with real estate. Look back 100 years at Vancouver prices and you will see a consistent doubling every 10-15 years. It won't stop, it just will look like it does for a short time. Even with huge drops in the market, this is consistent in BC.
Lets get a basic house to 10M$, first time home buyers can do it if they try. I'll gladly sell my middle of nowhere house for 6M$ to someone from Surrey, they can pocket 4M$ and I'll move to Spain or the terrible south of France.
Totally possible but it just takes time. You won’t be alive by then since it will take another 100 years for currency to continue to devalue and minimum wage will be $100 per hour.
@@Observer168 you kidding me? I went from 200k to 400k my first year, so 800k, 1.6M, 3.2M$, 6.4M$. I am only 4 doublings away! I thought you were all about this.
Just curious doesn’t CMHC use a value established with EMLI system? End of the day the value has dropped insured or non insured they will need to still address shortfall from drop in value. CMHC will not use the value of the pre-com purchase price, the emli system will determine a value based on comps specs area.
@@Observer168 I know, but from the early 2000’s to 2008 it was also 2-3 times the previous levels. As an example the place my brother bought in 2009 was close to $300,000, but in the early 2000s it was close to $100,000. Same sh1t, different decade.
To Canadians 45 and younger, other OECD countries are NOT like this! Canada is cannibizing its youth while importing the youth of other countries to drain them dry and then discard their withered souless husks once all value has been extracted. Unless you come from a wealthy homeowner class with a job secured by nepotism you need to flee Canada. Don't give this country your youth, dreams, or career. I'm doing the same at 36 with a STEM degree, GFTO to Europe or USA asap, the grass really is greener elsewhere.
A lot of Europe has worse opportunity than Canada however. Also its a lot harder to get in and have any opportunity at the good jobs in a vastly more competitive country which you dont even speak the language of likely (other than the UK). In my industry we have tons of young people coming over from the UK at 5-10 years experience. Much better life in Toronto or Vancouver than London.
That's not saying much. I'm being Italian if not for a family obligations i would certainly go back to Italy and just buying a home cash is 15 to 20 years of work
Housing is a supply side problem. Construction is one of the most inefficient and least innovative industries. To really get housing down in price, we need a lower cost way to build homes, and municipalities need to cut zoning/inspection/assessment fees and times. CMHC extension to 1.5 million is a sick joke that just highlights how bonkers home prices are. Median income is 43k/yr (2022 numbers are the most recent published by stats can). I wouldn't like to use average income, as it is dragged up by wealthy older people who are not likely to be first time home buyers. At 43k/yr with an average home price of 700k, Canada long ago entered the realm of dysfunctional. In the 1950s and 60s a home was between 2x and 4x annual income. The equivalent would be a home costing between 86k and 172k today. So the government let the market get that bad and has taken no action, because home price appreciation juices Canada's GDP numbers. On inflation, celebrating 2% after all the damage of the past few years is definitely just for economists and elected officials to do. For the working class, we have to fight for wage gains to make up the difference, and we're going to be vilified as greedy for simply treading water (assuming we even get matching wage gains).
Even though I'm against that policy, you can justify extending CMHC loans to 30 years for new builds to stimulate home building. However, extending amortizations on resale homes is insanity. It shows how illiterate and corrupt this government is.
Young people don't want to spend $2 million on an decrepit, ugly house in East Van or the suburbs when that same amount buys them a luxury new modern farmhouse on the island, or Alberta, or further out in Surrey, Mission or Chilliwack. How many millionaires want to live in squalor? Prices coming down has to with 1. price and 2. quality of inventory, nearly zero to do with borrowing power and rates.
It’s not young people buying the $1.5-$2 million dollar run down homes. It’s ironically people with money that tear them down to build duplexes or new multi million homes.
After all the bullshit I went throught with losing my job to vaccine mandates and the real estate crisis, the first thing I don't want to do is leverage myself to the tits on canadian real estate.
It's not only developers they are protecting. Boomers and GenX are retiring in droves now and over the next 15 years to the extent that our population is going to be retiree-heavy. Contrary to popular opinion, most people of those generations are not ultra rich, and many have their entire retirement savings in home equity. Even without ensuring that home equity is as high as possible, we are going to have to start finding ways to care for these elderly people. Do I think this is also why MAID was legalized when it was, after decades of discussion? Yes, in large part (and I support MAID for those who truly need it). It's also why governments are starting to lean into laws that are in place in most provinces to make adult kids responsible for supporting their parents (people don't know about these laws because parents rarely sue their kids for support).
sooner or later you gotta pay the piper let housing correct itself...then the countries debt has to be addressed it's going to be rough for the next 10yrs.
I'm slowly regretting the pre-sale condo I bought in Langley earlier this year; it will be built in 3 years. What I will need to charge to breakeven monthly will likely be far above what going rental prices will be in a few years time with all this coming supply. Only time will tell.
Why would you buy a condo in langley though.... the point of moving way out there is to have land and space? There are a half dozen towns between downtown and langley to live in. That said its these areas when times are good which go up vastly more as a % but also fall vastly more in bad times.
@@RainCity3rd - The skytrain will be coming to Langley in 4 years time and real estate was forecast to boom. There should be more people moving out there as well.
@@BassBwoy3 thats rather speculative. us individuals are the very last in line to know these things, big developers, medium and small are doing everything in their power to know when and where such things are going to happen and making way larger bets. Im sure even doing some sketchy things to influence. Speculating on this sort of thing is no different than playing penny stocks or betting on alt coin crypto though. As long as one understands the risk go for it but these are far from sure bets.
JT is on record saying that we need to protect home values….this policy proves it. If seniors loose most of their house values they then become a financial problem for the government and 30-40yr olds won’t inherit as much
The question on my mind that relates to this is: What are the practical limits to this policy of backstopping housing? Too much more of this and Canada is skrewed but when and why will the music stop? I would argue that this policy is of encouraging young people to bury themselves in debt is leading to weak consumer spending, a demographic cliff (we cant afford children) and in general this country is boxing itself into a corner where we have nothing to offer young people. The best move for my career is to move south and make more/ save money on housing.
Inflation is down? That must be why my usual chix thighs went up $2/package You are aware that it is your signature on the mortgage documents, that actually creates the 'loan' out of thin air. Right?
For those saying that the housing market is going to crash for sure, please be careful, you might be giving very bad advice and really hurt someone who would otherwise buy a hard asset that is inflation proof. PAPER MONEY IS CRASHING FASTER THAN THE HOUSING MARKET
@@saretsky absolutely 💯 Home prices (and specially condos in the gta) have completely collapsed in terms of gold and are down something like 60% but that’s somehow difficult for the proletariat to understand
Have to let the presale condo market find its new level. No bailout!! Government needs to stay out of the market. The liberals would be over their heads managing a 25 cent lemonade stand. Terrible decision to increase borrowing and bailing out very successful investors who have made thousands in the presale market in years past. Keep up the good concise content!
In light of the diminished inflation signals and the Federal Reserve's decision to suspend rate hikes, which investments would be the greatest additions to a $120K portfolio to improve portfolio performance this year?
Seek for stocks that have maintained consistent dividend growth over many years, especially during recessions, and have not reduced their payouts. As an alternative, consulting a licenced market strategist can provide guidance on which stocks to buy.
It is true that some people use hedging strategies or allocate a portion of their portfolio to defensive assets that do well during market downturns. These kinds of tips can be obtained by hiring market experts, as I did in 2019 during the rona outbreak. Today, I can report a 45% increase in my $1 million portfolio after purchasing assets that my advisor recommended.
How can you get more loan if the condo appraisal is short? So if I buy a condo for 700,000 and give the builde 20% ( 140k), and it appraises at 550,000, the bank will give me max 90% ( only if this is my principal residence, as you can get a maximum 80% LTV mortgage for investments) of 550 which is 495K, plus 140 down, I am at 635, and not 700k. The value drop has to be less than 10%, for it to work, and even then, CMHC premiums get added, and it has to be a principal residence. A very small portion of preconstruction sales in this exact scenario. If we want to build 3, or 4 or 6 million homes, do we want the hom3 builderz to fail?
is there any way back from this dependency on housing? I can't think of a country that's successfully moved away from the housing as assets debt spiral
Im not in debt , a freed slave, and for the last 6 months I have spent only on the most important essentials. Now that I'm used to having no little extras in my life its become very easy to ignore that impulse to buy unnecessary goods. No bars, pubs or restaurants, I even make my own cider now which just costs pennies compared with highly taxed booze be it local or corporate made. Good luck to you surviving whats hopefully the last of Trudeau's ruination of our country and economy.
Truthfully, in the back of warrior Steve's mind is that book Willful Blindness....the amplification of value in paper dollars will soon meet broken speakers IF "they" cannot defend their SUPPLY OBFUSCATION USING PAPER GAMES.....LBMA is where it will begin
Does nothing in the long term, Canadians are in more debt than most other people in other countries. Not to mention the amount of taxes, inflation and low wages ...all a recipe for disaster. Get out while you still can.
The Canadian housing market appears to be heavily influenced by banks, which often receive government support during times of trouble. Many recent policies seem to prioritize the interests of banks over the need for affordable housing. For instance, with 160,000 pre-sale units in the Greater Toronto Area averaging around $850,000 each, that's a staggering $136 billion at stake. A decline in housing prices could be disastrous not just for developers but primarily for the banks backing them. This financial risk drives government initiatives that aim to stabilize real estate prices rather than make housing more accessible for everyday Canadians. As long as banks can find buyers among the wealthiest 1% or institutional investors, this cycle is likely to continue, leaving affordability out of reach for many.
At this point, can we really trust any of the info/numbers from the federal government or BOC? I used to buy a 2 pack of bacon at Costco for $12.99 and in a span of 18 months it's now at $22.99. 2% inflation my ass!
thats why we dont measure inflation by costco bacon though... we use a basket of common things. Obviously each of us have slightly different actual experiences depending on the actual goods we buy. Beef going up a ton for various reasons isnt going to to hurt a vegetarian family as badly. If you didnt need a new vehicle while vehicles prices were out of control you skipped that nightmare, others had no choice but to buy.
The govt sees a declining economy, rising unemployment and no future demand coming next year for new build real estate. All the new inventory will be added to the ever rising inventory in the resale sector. This will bring on a potential crash that you dont have to be a rocket scientist to see on the horizon. It's another one of those very small policy changes that will help some people in a small way and slow down the declining prices incrementally. Kinda like bringing a knife to a gun fight if you ask me.
Introduction of the subprime mortgage shows how big of a problem it is. Soon a large number of idiots (mostly new bees) will sign up for the subprime mortgages without knowing the consequences.
This might be a case where the Liberals' attempt to squeeze even more out of an already overheated market could backfire. Median home prices in Canada are now more than double those in the U.S., a gap that's becoming harder to ignore.
anyone doing the comparison is comparing apples to oranges.... USA has 10000 Winnipegs, driving down the average price. If you compare things that are alike, aka Vancouver to California, Toronto to NYC..........USA is still 2x to 3x Canadian prices.
Do you believe at some point that the value of money will stop going down? Remember that 50k for a house was an insane amount of money 50 years ago. Again, same story but different decade.
If you watch the trends in these finance rants all over UA-cam, it’s always negative , declining, or on Wall Street , denial. Try counting how many young people first time home buyers will qualify for 1.5 mortgage? Let’s make sure mom and dad boomers co-sign for all of their children’s home financing . Then when it crashes, we get their houses too. 😅
They all already co signed in 2021 when FOMO was strong, moon forever and rates were "going to zero" HELOC downpayments were flying with "low rates for the foreseeable future". Parents were scared their adult children will never own.
@@Observer168 the cosign doesn't matter much especially if they are retired, family handing over a few hundred grand in down payment has a massive impact on getting into the market. I dont believe i know a single person around my age who has a single family house who didnt have at least some family help even if it was only 20 years ago 50k loan they had to pay back but which got them into that first condo they otherwise would never qualify for. I would not have any issue with boomers passing forward inheritance early except for that it is only those with wealth who can transfer and those who dont are left further and further behind which is IMO very problematic. I dont think anyone is particularly concerned for the kids of wealthy people who can just have average normal careers but life in nice houses without much care in the world. I know many, its not their fault they live comfortable lives, the people with great jobs who can hardly get ahead and those with average jobs who are falling further behind is the big issue.
Another youtuber claiming Canadian Realestate will crash... ppl been saying that since 2010 Were not the United States. We never overbuilt during the boom (with maybe the exption of the small condo market) abd population growth continued to outpace builds. The market has to remain expensive because with a shortage of homes many ppl have to continue to be locked out of market Sure the market has slowed big time. Not surprising with the surge in rates, even investors couldnt buy homes at those rates at current prices. But rates are already dropping. Can prices drop another 5% to 10%? Possibly. Pullbacks happen all the time. A full out crash? Only if we get major job losses. And i mean major job losses among the employed, not the rise in unemployment we seen thats been mostly concentrated among youth and recent immigrants who dont own homes because we havent actually lost many jobs but rather job creation didnt keep up with population growth
When we say inflation is down, we are talking about ongoing inflation that sits on top of the inflation that has already happened. It is important to distinguish.
Back in the day, when I purchased my first home to live-in; that was Miami in the early 1990s, first mortgages with rates of 8 to 9% and 9% to 10% were typical. People will have to accept the possibility that we won't ever return to 3%. If sellers must sell, home prices will have to decline, and lower evaluations will follow. Pretty sure I'm not alone in my chain of thoughts.
If anything, it'll get worse. Very soon, affordable housing will no longer be affordable. So anything anyone want to do, I will advise they do it now because the prices today will look like dips tomorrow. Until the Fed clamps down even further, I think we're going to see hysteria due to rampant inflation. You can't halfway rip the band-aid off.
consider moving your money from the housing market to financial markets or gold due to high mortgage rates and tough guidelines. Home prices may need to drop significantly before things stabilize. Seeking advice from a financial advisor who understands the market could be helpful in making the right decisions.
I will be happy getting assistance and glad to get the help of one, but just how can one spot a reputable one?
There are a handful of experts in the field. I've experimented with a few over the past years, but I've stuck with ‘’ Carol Vivian Constable” for about five years now, and her performance has been consistently impressive. She’s quite known in her field, look-her up.
I just looked her up on the internet and found her webpage with her credentials. I wrote her a outlining my financial objectives and planned a call with her.
I sold an apartment in Rochester and made about $250K. I was frustrated when I only earned $171 in interest from a regular savings account. After doing some research, I was advised to invest in stocks. Are these stocks a good point to start from?
While the stock market is promising and can give good ROI, expert guidance is essential for effective portfolio management so you don't get burnt out in the market as it is very volatile.
true, I have been in touch with a brokerage Advisor. With an initial starting reserve of $80k, my advisor chooses the entry and exit commands for my portfolio, which has grown to approximately $550k.
I’ve been looking to switch to an advisor for a while now. Any help pointing me to who your advisor is?
I've shuffled through investment coaches and yes, they can be positively impactful to an individual's portfolio, but do your due diligence to find a coach with grit, one that withstood the 08' crash. For me, Sophia Maurine Lanting turned out to be better and smarter than all the advisors I ever worked with till date, I’ve never met anyone with as much conviction.
Thank you for this tip. It was easy to find your coach on web. Did my due diligence on her before scheduling a phone call with her. She seems proficient considering her resume.
When the federal government steps in to boost demand, it’s usually trying to stabilize the economy in some way. The housing market is a key part of that. If they didn't intervene, things could slow down to the point where people might not be able to sell their homes, or the construction industry could take a hit, leading to job losses. But yes, I see why the idea of a "bubble" feels risky.
True, stabilizing the economy is important. But how long can they keep boosting demand? If the government keeps pushing low-interest rates or offering buyer incentives, won’t that create artificially high prices that could eventually burst?
That’s definitely a valid point. Artificially inflating prices isn’t sustainable in the long run. But the government’s role can sometimes be more about providing short-term relief and maintaining confidence in the market rather than permanently inflating demand.
It’s a balancing act. They have to be careful not to overstimulate the market, but at the same time, a sharp drop in housing prices could hurt a lot of homeowners and the broader economy
If there’s a slow, steady rise, that might be manageable.
It sounds like walking a tightrope. I wonder, though, how an individual investor or homeowner could navigate all of this. Would it make sense to just sit on the sidelines and wait until the market cools off? Or would that mean missing out on opportunities?
Inflation is down, so what? Our salaries have lost value, we can purchase less and it doesn't matter that interest rates are lowering, we are still poorer than we were a few years back. We are now only losing the currency's value at a bit slower rate. Since this government took over, literally not one thing is better.
Stoners got their dope stores on every corner.
@phill6159 lots of them closing, that was a crazy bubble.
In all honesty it’s the whole west countries/occident going down for the past 10y , UK, Europe , Australia etc the only countries getting better are east of Europe, Asian and some Arabic
I pulled an example from the internet and going from 25 to 30 years doesn’t lower the monthly cost that much but what it does do is increase the amount of interest you’ll pay over the amortization by alot!! 30 years benefits the lender not the borrower.
Yep!
Exactly. They fool you into thinking they're helping you, when they're actually stealing more from you.
it also benefits the seller at the expense of the buyer. Anything we do to juice the ability to pay more does so for everyone or nearly. Its like people who figure out they can afford more house if it contains and income suite, but dont get that if they cant afford more so can everyone else and thus the sale price just compensates accordingly. You just pay another 300k or so now plus the decades of interest on it, then most of these get lazy and dont actually bother to rent the place out and just eat the additional costs.
It depends on the interest rate. The lower the rate, the bigger % of mortgage payment goes to principal.
This means that if rates decline significantly relative to whatever interest rate you used in your example (I’m guessing this was ~6%) the difference in payment between 25 and 30 yr amortization will increase significantly
When you help people pay for high prices, you help support high prices.
Save the banks . Increase the CMHC insurance. Ponzi scheme desperation. Young people should just keep renting and stay away from house purchase for 36 months.
The buyers aren’t young people because it normally takes decades to save for a down payment unless you got rich parents. Most buyers are rich immigrants in their 40’s or 50’s. Most young people can’t beat the stress test.
@Observer168 I bought my house when I was 35 years old
Came to Canada as a refugee. I worked hard saved up and invested in the stock market
It took me 10 years to save up.
I worked in Northern Canada specifically NWT. Most of you are not willing to uproot yourself and work in a remote area.
I sacrificed to buy a townhouse in Fraser Valley. Best feeling ever.
I love my home. ❤
@@MiaAlex-q9s congrats dude! Certainly isn’t easy but you did it! It’s much easier for a young person to buy farther from the city.
@Observer168 do you have a source on that stat or did you make it up?
It won't matter Steve-O. Nothing will stop this bubble from crashing.
Perhaps some markets ie tor condos but detached homes are too few and far between with no new ones being built.
Keep dreaming.
@@zooski1516delusional
@@DJRS2178 yes they are 😂
@@Merakiii1123it might crash but money loses value over the long run which means assets like gold, stocks and real estate will get more expensive
@@Merakiii1123 GTA inventory is exploding and many condos going no bid. It's already begun.
As a cautious realtor, I always advise clients to avoid overextending themselves financially when buying a home. While I agree with you, Steve, that actions often speak louder than words, I believe the government's determination to stimulate the housing market poses a significant risk. The fact that over 40% of our GDP is tied to housing raises serious concerns about the potential consequences of a market correction. For now, it seems unlikely that we'll see a significant downturn.
It's disheartening to see that fiscally responsible individuals are being left behind while speculative behavior is rewarded and protected by our government. This creates an unfair playing field and can lead to further economic instability.
By hook or by crook should not be the way for Canadians' fortunes.
Well said.
Stagflation is going to be hell for years to come.
@@user-le2hu1ct4t Stagflation is stagnant wage and productivity with inflation, not deflation. I personally want housing deflation, otherwise the economy will be a never-ending grind.
@@zomgoose Yeah but what I mean is, if you have a steady income you can benefit, goods and gas are both in deflation rn and the gov only really cares about re, which they will seemingly do anything to inflate continuously.
You could have a situation where many aspects of the economy are in deflation while re keeps the read above zero. Is it good for Canada? Of course not but who cares, the commoners don't make the rules.
Stagflation is the worst of all the "flation" scenarios
@@user-le2hu1ct4ti think the majority of Canadians will be angry when they see stagnation or possible weakness in re prices, and everything else keeps on getting more expensive. People will not feel as wealthy with flat or sinking home equity, as the living standards and buying power are eroded away by inflation at the same time.
Commodities may be in deflation right now, but the long term outlook is great. Asset classes that are already massively overvalued will struggle in a stagflationary environment. However in the US where re prices are more reasonable, there is a higher ceiling for prices to climb. So I can see a scenario in Canada where housing is weak, but everything else will keep getting more expensive. I expect to see the massive divergence between Canadian and US prices to shrink in margin. So a positive outlook for the US, but not Canada.
@@user-le2hu1ct4t The positives are there, but they are only there for the rich who can swoop in and use their capital to scoop up the assets of those who are slipping down the ladder as their income buying power is eroded. This increasing wealth inequality slowly erodes the middle class and moves more and more people down the ladder and a small, tiny, group of people benefit by concentrating their wealth.
Pretty honest rant. Well done Steve.
This bubble needs to pop. Justin Trudue and Steven Harper both did everything in their power to create this housing bubble. But the can only get kicked down the road for so long before it explodes.
Unaffordable housing is a big issue in every major city in the world
but pierre pollievee is going to solve the issues right.
harper and turdo both didnt do shit so what makes another con pm to kick it further down the road too.
@@butwhytharum Personally? I think Pierre will kick the can down the road just like JT and Harper. As shitty as it is. The only way I see the housing sector bubble pop is if JT decides to do it on the way out for Pierre to deal with the after math.
Other then that, I think no one will do the hard job to correct the housing sector because it hurts the home owners.
@@windatar6351 The only way to unwind the problem is to put tens or hundreds of thousands of people into apartments/homes built and serviced by government owned housing. This would get people outside of the pressures of the RE market which will never cool off as long as it is an investment vehicle. No matter how many homes get built and sold on the free market prices won't come down as there is enough money out there to snatch them all up (Canadian cities are too regulated to allow truly huge numbers of homes to be built). So, the only way to give people affordable homes is to circumvent the private market and provide government funded and run houses. Obviously this isn't ideal as people cannot build wealth as renters, but it could help to get people stabilized and would likely improve consumer spending and productivity mildly as lower rents would allow people to spend more on consumer goods.
Or you could curtail RE investment by imposing a significant asset tax on investment properties. Say 8% per year on the assessed value real estate, with exemptions on the first two properties so people's primary and maybe vacation homes aren't effected. Apply this to RE owned by private equity and corporations as well. That'd put a pretty big hurt on the ROI for RE and crush it as an investment vehicle.
I agree with everything you say about the timing of cmhc regarding bailing out the development community. All they are doing is putting people in more debt.
As they said in the USA a long time ago don't fight the Fed. The government will keep juicing asset values so don't fight it. Buying and holding assets will always be profitable in the long run
Some are bending in front of the devil.
Some are choosing the path of courage and truth.
All that is gold does not glitter,
Not all those who wander are lost;
The old that is strong does not wither,
Deep roots are not reached by the frost.
From the ashes a fire shall be woken,
A light from the shadows shall spring;
Renewed shall be blade that was broken,
The crownless again shall be king.
sad but true
Capitalize gains…..socialize losses…. The liberals need to go!!!!! I don’t mind if it’s limited to home owners but we can’t let this be applied to investors.
Lose/lose for the taxpayers as always
Every single government regardless of conservative or liberal will do the same
That's the reality
Who will ever capitalize losses and socialize gains though? We need a real change and I don't see anyone out there with the balls to stand up to the rich who are benefitting from the socialized losses.
You are very passionate about this. Explained it all very well. I totally agree. They are buying voters.
Unpopular opinion. If you're buying a 1.5 million dollar condo you'd better have at least $500k kicking around, maybe not just for the purpose of buying that condo but you better have that kind of money for unexpected economic fluctuations.
Actually a 30-35% down payment isn’t rare at all. Sometimes it necessary to beat the stress test.
Who in their right mind would pay that price for a condo anyway, regardless of the circumstances!!!???
@@katethegardener I have, and then sold it 7 years later after a reno for 4.45MM.
@@sneakybastardmusicyes, high end condos such as the Shangri La are in high demand
@@Observer168 im sure an industrial power plant next door is in demand. the building is higher than the boiler stack so all those high end units have great air quality.
the shangri la in toronto is next to a powerplant.
I have never heard this explained so clearly. Thank you.
Time to buy pre-construction condos for 1.5 millions 😂
A $1.5 million dollar unit at the Vancouver Shangri La bought in 2007 is worth many times that now
The monthly mortgage on a 1.5 million house is 8,000 per month plus property tax, home insurance, and HOA fees (if applicable). Construction was made a sizeable part of the economy with the expectation of a 20% increase every year. Many people became rich, but we are in limbo in the long term.
Idk how ppl can pay 8k in mortgage cost per month...crazy
Great points Steve. One last tin foil hat issue is they are slipping this in before tackling the mortgage fraud issue. Still studying the massive task of simply telling banks if a number matches on the NOA. This government has turned me in a single issue voter and that disgusts me.
Going long Canadian RE and US equities has been a good strategy since the 90s for the gen xers.
All they have done is hasten the demise of the economy.
They are really trying to squeeze every last drop out of this lemon. Lol
Great video! Good sound information! Thanks Steve. Keep them coming
@@pinavescio8937 thank you
Market sentiment has completely changed, the bubble is popping no matter what....
You hope
Thanks for the government to support housing. A majority of Canadian own mortgage and house and vote for housing support
Awesome stuff Steve. Rate from the hip.
The average Canadian cant even come close to paying rent on a million dollar condo. So im not sure how that all plays out.
Probably worried about house prices going down before an election,..
I'm pretty confident, JT is just bailing out a developer that has been a faithful Liberal donor.
A honest opinion at last!! Thank you!
So true on the CMHC limit, good one
Great to hear you stating what everyday Canadians are saying. Most agents say...buy ...buy...buy all the time with a twist here and there.
Steve I've watched your video's for a few years now and while I sometimes agree and sometimes disagree with your viewpoints I do have a lot of respect for your insight. Something I'd really like to hear your opinion on is if you think these policies aimed at strengthening the demand side of the housing market is tied at all to a desire to prevent the loonie from dropping. Canada's GDP is around 20% real estate transactions and around 44% of household consumer held assets are held as real estate. I wonder if our policy makers are so insistent on propping up real estate assets because they are scared of what a housing crash would mean for the loonie, I imagine a lot of demand for Canadian debt would dry up if we had to stomach a protracted asset revaluation in a sector that makes up a fifth of our gdp and almost half of consumer assets.
Also great video, I really enjoyed this one. You hit on some great points.
@@kenrichards1032 thanks. Not so much the loonie but the broader economy. So much wealth and spending is tied to housing that any prolonged downturn will be a serious drag on GDP
@@saretsky Hey Steve, thanks for taking the time to respond. I definitely agree that GDP dropping is one of the biggest metrics at risk in the event of a Canadian housing downturn; also agree that there are broader economic impacts that don't get considered particularly Canadian lumber and steel prices as construction slows down. I guess in my mind GPD is somewhat loosely correlated to bond markets and if Canadian GDP started taking a seriously hit I'd start to worry about what that means for demand in the Canadian bond market. Canada's economy is in a uniquely intermingled state though and its hard to really predict what dominoes will knock over what.
"When is a gift, not a gift?" - Baron Vladimir Harkonnen
4 years ago, at the start of the pandemic, Tiff said, "interest rate is gonna stay low for a very longgggg time, if you need to buy a house, etc". Now that the BoC has learned its mistake, it's the Fed's turn.
Under the current rules insured $900k+ are pretty rare. $1 million+ insured mortgages are not going to have a large uptake.
Kudos for your insights. Don't the Feds have housing/economic experts to consult before risking Canadians' futures??
They only consult with the WEF.
They only care if it gets them votes.
Question: if you are over leveraged to pay for your 1.5 million mortgage. What will be left for you to build a retirement fund? Food, clothing, transport costs ?
Depends on where you live, Ie. In BC even if you are over leveraged on your home, if you can continue to pay it off over 30 years, you will have a 6-12 million dollar property over that time (bc tens to double housing prices every 10-15 years). If you live in a different part of Canada, it's more like double every 15-3)25 years.
For me, I have seen my property investments go from 125,000 in 2010 to 2,300,000 today. Just make sure you own a home for an asset rather than a place to live. Rent out the basement, use the equity to buy a second rental property, whatever you can do to make income off your home will benefit you in the long run, not to mention the tax advantages to writing off such a high debt load.
At least you got something to sell when you retire. Biggest mistake is renting into retirement. You don’t need to pay off the mortgage.
@@SydSengotta which is all well and good but less likely to continue into the future. Its like looking at a killer stock which performed over the last year or 5 or whatever. If it crushed it then its less likely to crush it in the future as the price is already up. Its cool your p;ace went from 125k to 3.3M but i'll bet you it doesnt make the same gains over the next 14 years. Someone who doesnt own right now has to decide do they buy a house for 2.3 and expect it to be 8M or whatever or do they invest elsewhere? maybe something less risky, more diversified
@@RainCity3rd if you look at an ETF in the stock market it consistently gives 10% per year (averaged). Likewise with real estate. Look back 100 years at Vancouver prices and you will see a consistent doubling every 10-15 years. It won't stop, it just will look like it does for a short time. Even with huge drops in the market, this is consistent in BC.
Lets get a basic house to 10M$, first time home buyers can do it if they try.
I'll gladly sell my middle of nowhere house for 6M$ to someone from Surrey, they can pocket 4M$ and I'll move to Spain or the terrible south of France.
Haha, good lecture on the reality of inflation
Totally possible but it just takes time. You won’t be alive by then since it will take another 100 years for currency to continue to devalue and minimum wage will be $100 per hour.
@@Observer168 you kidding me? I went from 200k to 400k my first year, so 800k, 1.6M, 3.2M$, 6.4M$. I am only 4 doublings away!
I thought you were all about this.
@@donm2067 sounds like your doing great, keep going!
Thanks for your work... buckle up... the dollar is a one wing bird..
Tell me sir... whats your vacancy rate in commercial realestate.
Condo investors made bad decision and government should not bail them out on behalves of taxpayers
Everyone ask your MP for your interest-bearing central bank digital currency. Taxation before home ownership is theft. Down with the deficit.
Just curious doesn’t CMHC use a value established with EMLI system? End of the day the value has dropped insured or non insured they will need to still address shortfall from drop in value. CMHC will not use the value of the pre-com purchase price, the emli system will determine a value based on comps specs area.
Blanket appraisals seem to be happening as a normal process on new build condos.
Don't see why CMHC won't join the party.
Condo buyers know its a deflation cycle - doesn't matter what the BoC of Gov't does, buyers know prices will be lower in the future
Unemployment in Calgary is 8.6 percent
"There is no free lunch" has been replaced by "There is no free market"
You still need to qualify, they haven't changed the ratios required to qualify
Have you heard about fake documents?😅
@@AmolGharatfake documents all you want but you still need to make the monthly mortgage payments.
Well said.
This happened during the last crisis in 2008-2009. Wasn't it like 40 year amortization, with nothing or very little down?
Yes but real estate has skyrocketed since 2008. Peak 2008 prices look cheap now.
@@Observer168 yeah, but real estate skyrocketed before 2008 also.
@@MaximusWhyman now it’s 2-3 times 2008 levels
@@Observer168 I know, but from the early 2000’s to 2008 it was also 2-3 times the previous levels. As an example the place my brother bought in 2009 was close to $300,000, but in the early 2000s it was close to $100,000. Same sh1t, different decade.
@@MaximusWhymanyup, it’s because the value of money keeps going down
To Canadians 45 and younger, other OECD countries are NOT like this! Canada is cannibizing its youth while importing the youth of other countries to drain them dry and then discard their withered souless husks once all value has been extracted. Unless you come from a wealthy homeowner class with a job secured by nepotism you need to flee Canada. Don't give this country your youth, dreams, or career. I'm doing the same at 36 with a STEM degree, GFTO to Europe or USA asap, the grass really is greener elsewhere.
A lot of Europe has worse opportunity than Canada however. Also its a lot harder to get in and have any opportunity at the good jobs in a vastly more competitive country which you dont even speak the language of likely (other than the UK). In my industry we have tons of young people coming over from the UK at 5-10 years experience. Much better life in Toronto or Vancouver than London.
That's not saying much. I'm being Italian if not for a family obligations i would certainly go back to Italy and just buying a home cash is 15 to 20 years of work
Canada's economy: a snake choking on its own tail
Follow the money. Carney = Brookfield = Genworth = $$ for increased insurance demand.
Housing is a supply side problem. Construction is one of the most inefficient and least innovative industries. To really get housing down in price, we need a lower cost way to build homes, and municipalities need to cut zoning/inspection/assessment fees and times. CMHC extension to 1.5 million is a sick joke that just highlights how bonkers home prices are. Median income is 43k/yr (2022 numbers are the most recent published by stats can). I wouldn't like to use average income, as it is dragged up by wealthy older people who are not likely to be first time home buyers.
At 43k/yr with an average home price of 700k, Canada long ago entered the realm of dysfunctional. In the 1950s and 60s a home was between 2x and 4x annual income. The equivalent would be a home costing between 86k and 172k today. So the government let the market get that bad and has taken no action, because home price appreciation juices Canada's GDP numbers.
On inflation, celebrating 2% after all the damage of the past few years is definitely just for economists and elected officials to do. For the working class, we have to fight for wage gains to make up the difference, and we're going to be vilified as greedy for simply treading water (assuming we even get matching wage gains).
Even though I'm against that policy, you can justify extending CMHC loans to 30 years for new builds to stimulate home building. However, extending amortizations on resale homes is insanity. It shows how illiterate and corrupt this government is.
Young people don't want to spend $2 million on an decrepit, ugly house in East Van or the suburbs when that same amount buys them a luxury new modern farmhouse on the island, or Alberta, or further out in Surrey, Mission or Chilliwack. How many millionaires want to live in squalor? Prices coming down has to with 1. price and 2. quality of inventory, nearly zero to do with borrowing power and rates.
It’s not young people buying the $1.5-$2 million dollar run down homes. It’s ironically people with money that tear them down to build duplexes or new multi million homes.
Boost demand and curtail supply, it governs only for the homeowners and screws the renters and young Canadians.
After all the bullshit I went throught with losing my job to vaccine mandates and the real estate crisis, the first thing I don't want to do is leverage myself to the tits on canadian real estate.
It's not only developers they are protecting. Boomers and GenX are retiring in droves now and over the next 15 years to the extent that our population is going to be retiree-heavy. Contrary to popular opinion, most people of those generations are not ultra rich, and many have their entire retirement savings in home equity. Even without ensuring that home equity is as high as possible, we are going to have to start finding ways to care for these elderly people. Do I think this is also why MAID was legalized when it was, after decades of discussion? Yes, in large part (and I support MAID for those who truly need it). It's also why governments are starting to lean into laws that are in place in most provinces to make adult kids responsible for supporting their parents (people don't know about these laws because parents rarely sue their kids for support).
sooner or later you gotta pay the piper let housing correct itself...then the countries debt has to be addressed it's going to be rough for the next 10yrs.
Basement dweller news alert ‼️ dude, market is not going to crash.
More people need to watch this video 🥶
I'm slowly regretting the pre-sale condo I bought in Langley earlier this year; it will be built in 3 years. What I will need to charge to breakeven monthly will likely be far above what going rental prices will be in a few years time with all this coming supply. Only time will tell.
Why would you buy a condo in langley though.... the point of moving way out there is to have land and space? There are a half dozen towns between downtown and langley to live in. That said its these areas when times are good which go up vastly more as a % but also fall vastly more in bad times.
@@RainCity3rd - The skytrain will be coming to Langley in 4 years time and real estate was forecast to boom. There should be more people moving out there as well.
@@BassBwoy3 thats rather speculative. us individuals are the very last in line to know these things, big developers, medium and small are doing everything in their power to know when and where such things are going to happen and making way larger bets. Im sure even doing some sketchy things to influence. Speculating on this sort of thing is no different than playing penny stocks or betting on alt coin crypto though. As long as one understands the risk go for it but these are far from sure bets.
JT is on record saying that we need to protect home values….this policy proves it. If seniors loose most of their house values they then become a financial problem for the government and 30-40yr olds won’t inherit as much
The question on my mind that relates to this is: What are the practical limits to this policy of backstopping housing?
Too much more of this and Canada is skrewed but when and why will the music stop?
I would argue that this policy is of encouraging young people to bury themselves in debt is leading to weak consumer spending, a demographic cliff (we cant afford children) and in general this country is boxing itself into a corner where we have nothing to offer young people. The best move for my career is to move south and make more/ save money on housing.
Hi FOMO Pumper 👋
Steve?
Inflation is down? That must be why my usual chix thighs went up $2/package
You are aware that it is your signature on the mortgage documents, that actually creates the 'loan' out of thin air. Right?
Ppl dont like change. Easier to do status quo.
Government can come up with this nonsense, for sure. Will people and lenders be foolish enough to actually do this?
Enjoyed meeting you last week, thank you for continuing to speak common sense.
@@manvsmachine1 likewise !
For those saying that the housing market is going to crash for sure, please be careful, you might be giving very bad advice and really hurt someone who would otherwise buy a hard asset that is inflation proof. PAPER MONEY IS CRASHING FASTER THAN THE HOUSING MARKET
@@-Nab- well said. Home prices in gold continue to get cheaper
@@saretsky absolutely 💯
Home prices (and specially condos in the gta) have completely collapsed in terms of gold and are down something like 60% but that’s somehow difficult for the proletariat to understand
That explains.
Have to let the presale condo market find its new level. No bailout!! Government needs to stay out of the market. The liberals would be over their heads managing a 25 cent lemonade stand. Terrible decision to increase borrowing and bailing out very successful investors who have made thousands in the presale market in years past. Keep up the good concise content!
In light of the diminished inflation signals and the Federal Reserve's decision to suspend rate hikes, which investments would be the greatest additions to a $120K portfolio to improve portfolio performance this year?
Seek for stocks that have maintained consistent dividend growth over many years, especially during recessions, and have not reduced their payouts. As an alternative, consulting a licenced market strategist can provide guidance on which stocks to buy.
It is true that some people use hedging strategies or allocate a portion of their portfolio to defensive assets that do well during market downturns. These kinds of tips can be obtained by hiring market experts, as I did in 2019 during the rona outbreak. Today, I can report a 45% increase in my $1 million portfolio after purchasing assets that my advisor recommended.
In order to improve my plans and save my portfolio, I require guidance. How is this advisor reachable?
Her name is Stacy Lynn Staples can't divulge much. Most likely, the internet should have her basic info, you can research if you like
How can you get more loan if the condo appraisal is short? So if I buy a condo for 700,000 and give the builde 20% ( 140k), and it appraises at 550,000, the bank will give me max 90% ( only if this is my principal residence, as you can get a maximum 80% LTV mortgage for investments) of 550 which is 495K, plus 140 down, I am at 635, and not 700k. The value drop has to be less than 10%, for it to work, and even then, CMHC premiums get added, and it has to be a principal residence. A very small portion of preconstruction sales in this exact scenario. If we want to build 3, or 4 or 6 million homes, do we want the hom3 builderz to fail?
is there any way back from this dependency on housing? I can't think of a country that's successfully moved away from the housing as assets debt spiral
Im not in debt , a freed slave, and for the last 6 months I have spent only on the most important essentials. Now that I'm used to having no little extras in my life its become very easy to ignore that impulse to buy unnecessary goods. No bars, pubs or restaurants, I even make my own cider now which just costs pennies compared with highly taxed booze be it local or corporate made. Good luck to you surviving whats hopefully the last of Trudeau's ruination of our country and economy.
@@phill6159 that sounds kind of boring
Truthfully, in the back of warrior Steve's mind is that book Willful Blindness....the amplification of value in paper dollars will soon meet broken speakers IF "they" cannot defend their SUPPLY OBFUSCATION USING PAPER GAMES.....LBMA is where it will begin
Does nothing in the long term, Canadians are in more debt than most other people in other countries. Not to mention the amount of taxes, inflation and low wages ...all a recipe for disaster. Get out while you still can.
The Canadian housing market appears to be heavily influenced by banks, which often receive government support during times of trouble. Many recent policies seem to prioritize the interests of banks over the need for affordable housing. For instance, with 160,000 pre-sale units in the Greater Toronto Area averaging around $850,000 each, that's a staggering $136 billion at stake.
A decline in housing prices could be disastrous not just for developers but primarily for the banks backing them. This financial risk drives government initiatives that aim to stabilize real estate prices rather than make housing more accessible for everyday Canadians. As long as banks can find buyers among the wealthiest 1% or institutional investors, this cycle is likely to continue, leaving affordability out of reach for many.
At this point, can we really trust any of the info/numbers from the federal government or BOC? I used to buy a 2 pack of bacon at Costco for $12.99 and in a span of 18 months it's now at $22.99. 2% inflation my ass!
thats why we dont measure inflation by costco bacon though... we use a basket of common things. Obviously each of us have slightly different actual experiences depending on the actual goods we buy. Beef going up a ton for various reasons isnt going to to hurt a vegetarian family as badly. If you didnt need a new vehicle while vehicles prices were out of control you skipped that nightmare, others had no choice but to buy.
Who really controls the market?
Central Bank's just respond to the bond market
The govt sees a declining economy, rising unemployment and no future demand coming next year for new build real estate.
All the new inventory will be added to the ever rising inventory in the resale sector.
This will bring on a potential crash that you dont have to be a rocket scientist to see on the horizon.
It's another one of those very small policy changes that will help some people in a small way and slow down the declining prices incrementally.
Kinda like bringing a knife to a gun fight if you ask me.
Introduction of the subprime mortgage shows how big of a problem it is. Soon a large number of idiots (mostly new bees) will sign up for the subprime mortgages without knowing the consequences.
This might be a case where the Liberals' attempt to squeeze even more out of an already overheated market could backfire. Median home prices in Canada are now more than double those in the U.S., a gap that's becoming harder to ignore.
anyone doing the comparison is comparing apples to oranges.... USA has 10000 Winnipegs, driving down the average price. If you compare things that are alike, aka Vancouver to California, Toronto to NYC..........USA is still 2x to 3x Canadian prices.
Thx
2% not in my world
Don't forget the conservatives launched 40 year, 0 down mortgages in 2008
I have a question, why 1.5 million? Why not 5?
Arbitrary
they only care about their personal property investments
USA 2008. Canada 2028
Not with continued rate cuts and government stimulus
They will keep it going and then tax it. We will all be equally poor. 🤣
I’m waiting 5-6 years for next boom cycle peak and then selling off my properties and moving to Florida where I have rights as a landlord
It will be more like 10 years or more.
Do you think at some point people will stop sucking down more debt?
Do you believe at some point that the value of money will stop going down? Remember that 50k for a house was an insane amount of money 50 years ago. Again, same story but different decade.
@@Observer168 Good point debt is definitely rewarded.
If you watch the trends in these finance rants all over UA-cam, it’s always negative , declining, or on Wall Street , denial. Try counting how many young people first time home buyers will qualify for 1.5 mortgage?
Let’s make sure mom and dad boomers co-sign for all of their children’s home financing . Then when it crashes, we get their houses too. 😅
9/10 people in their 20’s-30’s can’t beat the stress test so it already filters out many. Co-signing helps but not as much as you think.
They all already co signed in 2021 when FOMO was strong, moon forever and rates were "going to zero" HELOC downpayments were flying with "low rates for the foreseeable future".
Parents were scared their adult children will never own.
@@Observer168 the cosign doesn't matter much especially if they are retired, family handing over a few hundred grand in down payment has a massive impact on getting into the market. I dont believe i know a single person around my age who has a single family house who didnt have at least some family help even if it was only 20 years ago 50k loan they had to pay back but which got them into that first condo they otherwise would never qualify for. I would not have any issue with boomers passing forward inheritance early except for that it is only those with wealth who can transfer and those who dont are left further and further behind which is IMO very problematic. I dont think anyone is particularly concerned for the kids of wealthy people who can just have average normal careers but life in nice houses without much care in the world. I know many, its not their fault they live comfortable lives, the people with great jobs who can hardly get ahead and those with average jobs who are falling further behind is the big issue.
Price fall 2025 back to 2022 all time high I think but it won’t go much higher than that. People income can’t afford more
Inflation is at 2%, really, have you been grocery shopping lately ???
Another youtuber claiming Canadian Realestate will crash... ppl been saying that since 2010
Were not the United States. We never overbuilt during the boom (with maybe the exption of the small condo market) abd population growth continued to outpace builds. The market has to remain expensive because with a shortage of homes many ppl have to continue to be locked out of market
Sure the market has slowed big time. Not surprising with the surge in rates, even investors couldnt buy homes at those rates at current prices. But rates are already dropping.
Can prices drop another 5% to 10%? Possibly. Pullbacks happen all the time. A full out crash? Only if we get major job losses.
And i mean major job losses among the employed, not the rise in unemployment we seen thats been mostly concentrated among youth and recent immigrants who dont own homes because we havent actually lost many jobs but rather job creation didnt keep up with population growth
When we say inflation is down, we are talking about ongoing inflation that sits on top of the inflation that has already happened. It is important to distinguish.