Recessions are part of the economic cycle, all you can do is make sure you're prepared and plan accordingly. I graduated into a recession (2009). My 1st job after college was aerial acrobat on cruise ships. Today I'm a VP at a global company, own 3 rental properties, invest in stocks and biz, built my own business, and have my net worth increase by $500k in the last 4 years.
Let's face it... buying more stocks & index funds during stock market corrections and bear markets is scary. Which makes it really hard to do for most people like me. I have 260k i want to transfer into an s&p but its hard to bite the bullet and do it.
The issue is people have the "I want to do it myself mentality" but not equipped enough for a crash, hence get burnt. Ideally, advisors are reps for investing jobs, and at first-hand encounter, my portfolio has yielded over 300% since 2020 just after the pandemic to date.
To be honest, I've been wary of banks for a while, but I wasn't sure how to speak with an advisor first. Please let me know who your adviser is if it's okay; I need some recommendations.
Svetlana Sarkisian Chowdhury a highly respected figure in her field. I suggest delving deeper into her credentials, as she possesses extensive experience and serves as a valuable resource for individuals seeking guidance in navigating the financial market.
I just googled her and I'm really impressed with her credentials; I reached out to her since I need all the assistance I can get. I just scheduled a caII.
From $7K to $45K that's the minimum range of profit return every week I thinks it's not a bad one for me, now I have enough to pay bills and take care of my family
Stacey's understanding of market indicators is impressive. She knows exactly when to enter and exit trades for maximum profit. her signals are top notch .
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. Sure I'm not alone in my chain of thoughts.
Well i think, home prices will need to fall by at least 40% before the market normalizes. If you do not know whether to buy a house or not, it is best you seek guidance from a well-experienced advisor for proper portfolio allocation. So far, that’s how I’ve stayed afloat over 4 years now, amassing nearly $1m in return on investments.
this is quite huge! what have you invested in ? much more info needed please ...I think this is something I should do, but I've been stalling for a long time now. I don't really know which firm to work with; I feel they are all the same but it seems you’ve got it all worked out with the firm you work with so i surely wouldn’t mind a recommendation.
@@williamDonaldson432 this is quite huge! what have you invested in ? much more info needed please ...I think this is something I should do, but I've been stalling for a long time now. I don't really know which firm to work with; I feel they are all the same but it seems you’ve got it all worked out with the firm you work with so i surely wouldn’t mind a recommendation.
GDP's already negative, the housing market's already crashing (see all-time high number of price reductions without any sales still), all-time consumer credit card debt, unemployment is skyrocketing and will surpass 2009's 10% peak. Homes and stocks will crash 60%. It's literally 3rd grade math. It was always inevitable. Already seeing it in every single asset class other than the Crypto market ....I've been engaged in active trading and managed to grow a nest egg of around 2.3Bitcoin to a decent 24Bitcoin....I'm especially grateful to Linda Wilburn, whose deep expertise and traditional trading acumen have been invaluable in this challenging, ever-evolving financial landscape.
In a field as rapidly evolving as cryptocurrency, staying updated is crucial. Linda’s continual research and adaptation to the latest market changes have been instrumental in helping me make informed decisions.
When it comes to investing, we want our money to grow with the highest rates of return, and the lowest risk possible. While there are no shortcuts to getting rich, but there are smart ways to go about it.
Even if prime drops to 3.5% it doesn’t change the fact that wages haven’t kept up with home prices. It doesn’t change the fact that at these prices even with a 20% down payment the buyer can’t get a mortgage based on the average income. If home prices don’t drop substantially home sales will remain slow until wages increase back to a normal wage to home price ratio.
You guys should make a video shedding light on the tenant landlord board. I find it absurd that landlords are still waiting over a year to get a hearing.
I’m sorry to hear that. I’m glad I, and my siblings, have had the ability to stay in Canada. I’ve bought a home, my sister and her fiancé are homeowners and our two younger siblings will hopefully be able to when they are a few years into their careers.
@14:00 No one is buying condos because Vancouver and Toronto way over-built condos. People talk about a "housing shortage" in Canada. But it's shortage of family-sized housing, not of shoebox sized housing. We have more condos than we need and the only reason these were selling was due to speculators and investors who were enabled to bid up the prices by ultra-low interest rates. Now that the investors have pulled back the real demand for micro condos is clear: there is none.
So we have a population surge while at the same time massively increasing development fees on new homes which means the the young are effectively subsidizing the old.
All you need is one person to sell at a lower price which then sets precedent for the rest of the area. Some may hold out but can every seller afford to hold. Those who do try to hang on are chasing the market lower.
You are so correct. Look around you; look at all those BMW's, Teslas, Porsches, Lexus's, etc......do you think the spending shift in the Canadian homeowner culture is indicative of financial wisdom - - - or maybe closer to the opposite???
Back in the day the govt would incentivize something that was of need to the country. At this point all levels of govt need to eliminate all fees and taxes on new builds and raise existing property taxes accordingly to fill their financial void.
That's absolutely what's needed. It would solve the problem, but would hurt the home equity built up by most Canadians. I fear we'll never take that step.
@@duncanmccabe974 I bought my last house which I live in now, in 1996 for 128k. I planned on it being Worth 350 or 400k when I was 60. I'm 61 now and it's worth 1.1 mil. I'm fine with it going down 40%, it will still be above my retirement expectations, and so are all my buddies. Anyone who bought 20 or more years ago who is reaching retirement in the next 10 years who says their retirement was based on their house being worth a million bucks is LYING.
@@Stormshfter that’s a healthy perspective. If enough Canadians recognize the problem for what it is we could fix this. 40% correction sounds aggressive, but it may be needed
prices in Vancouver haven't fallen substantially yet because people are greedy, plain and simple. So until it becomes absolutely necessary for someone to sell (ex. loss of employment) they will hold on to the last minute. But this is coming !!!
Greed is just a sub-category of ignorance. People in Vancouver lucked into stupid gains over the last generation, and now the pendulum is swinging towards the stupid losses zone. Can't be stopped this time.
Like john said around the 24 min mark, sellers are anchoring their asking prices according to peak prices. Where would you say the buyers are anchoring their bids at?
Steve hit the nail on the head - Low property taxes and rising development fees are transferring wealth from the young to the old. Boomers will say they care and want their kids to be able to afford a place, but good luck finding one that's okay with paying higher property taxes on their $1.4m home that they bought for 200k. Instead we'll charge the newly forming family an extra 50k and call it a day. I shouldnt say this because it might give the government ideas, but if you raise development fees to 1m dollars per house you can set a floor on home prices and make people even richer! I'm sure someone out there thinks this is a genius idea.
Here in Nova Scotia we are still seeing home prices increase in most regions. Inventory is increasing because of properties that are overpriced as we have had a spike of new listings.
Construction companies will accept a bid. And then go immediately into a hiatus. And leave all their equipment on-site for months. Why is that? Is it some sort of contractual leverage? Does anyone have a deep dive into municipal tort law?
Just a question about development charges etc. People talk about them being a "tax" which increases "cost" and thus discourages consumption. My question is this - in Real Estate, where land is a key component of the underlying input costs but where there are no "production costs", it would seem that a real estate tax does not actually increase the ultimate cost to the consumer but instead is a confiscation of value from the underlying land. Since a project development will be priced out based on the underlying market - the "plug" is land value - and ultimately the taxes ensure land values don't increase more. If the tax is removed, it would either translate to more profits or push up land prices. This is especially true where land is a very significant component. If land was basically negligible, then it would be a true cost increase but in the case of Vancouver and Toronto I would say development charges are merely pushing land prices down. Thoughts?
Great question, and I will confess I don't have a perfect answer, but here is what I suspect would happen. If you cut development charges by $100K per unit, just as an example, home buyers would not see prices fall by that same amount for each unit. They will see some price drop, but part of that $100K will be absorbed by land values and developer profits as you suggested. But I suspect the timing of when that happens is relevant. In a market like today, when nothing is selling, I suspect you would see more of that cut in development charges flow through lower prices because developers would rather sell units vs sit on land. If development charges are cut during a booming market when demand is strong and builders can't bring enough units to the market - and buyers are fine with current prices, in that scenario I suspect your argument would more likely hold where more of those cuts would drive up land values and profits vs reducing prices
@@john_pasalis sounds correct - there is a big timing issue here in that land buys are always a spec trade as you don't get to do your pre-sale the same moment you buy your land. This is why on the way up - things can get very profitable but on the way down - they can be a disaster and cause the flow of units to trickle as developers try to be able to close with a margin. Small one-time thinly capitalized developers won't make it and that is what we see now.
Can't wait for the day when real estate "experts" actually take some responsibility for the situation that their clients (the non-experts) find themselves in......instead of just being confused about those clients being reluctant to lock in losses. Now all of the real estate pros are suddenly conservative about the calculus that goes into buying and selling choices....oh - - - and they also happen to be "experts" about psychology and the phenomenon of sell-side hesitation. Most of these "experts" should not be doing nearly the amount of yammering they are doing right now. You are damaging your careers. Regarding the statement that in the major Canadian markets "homes are purchased by capital and not by incomes"; did you explain the unsustainability of this anomaly to your clients before they committed??? Did you give them any insight about possible negative hypothetical realities that can actualize when individuals compete against institutional/professional money? Because that's been the hallmark of the Canadian bubble for almost 20 years now. You guys have the attitudes and corresponding insensitivity/obliviousness that can only be born from a bubble market......when it's really hard to make profoundly bad decisions because of the sheer power of the upward trend. Now you are all being exposed; not just by the data - - - but by your first-person narratives. As someone who has been a trader and handled clients for almost 30 years, I am fascinated that I am actually witnessing the materialization of cautionary tales we were all told at the very beginning, when we were deciding what kind of professional we wanted to be.
i think that that the key driver of teh condo market are the out of control condo fees. You get some level of foresight of interest rates (even if not control), but no real logic is to condo fees.
Most investors are waiting for 2026 when there will be no new condo builds coming onto the market. Combine that supply crunch and lower interest rates is a recipe for 🚀
Great discussion. Dont often see Real estate sector admittto the softness of the market, and prices. It would be nice to hear from other experts like David Rosenberg
NOTICING significant increase in FOR RENT signs in front of apt buildings in North York Landlords spending $ new larger signs to attract LIKELY getting difficult to rent at these 'all time high asking prices'
People who survived 2008 - 2011 recession in Canada will not ever thing about spending their lively hood and saving in Canada. One would try their best to move to US instead of Canada.
I hope prices start to decline. Most inventory sitting on the market is overpriced and undesirable. Even if we're in a buyer's market, it's still hard to see families work so hard to pay 2 million for a decrepit home. That's not good for anyone.
Home prices are down 5% yoy house for house. The average is down 1% but the home composite index is down 5%. That is to say that the same house sold a year ago was sold for 5% more.
I’m in a wait and see loop. The extra money I have for my home upgrade is in USD equities. The last few years of waiting has worked out, but it’s less clear these days.
Thank you for listening! There is a gap because our podcast drops new shows weekly first thing Tues morning - so videos go live on Fridays and that podcast that Tuesday - so shouldn't be a week long delay but of a few days. We'll look into optimizing our schedule further as we can! ~ Urmi
IMHO, I don't think Jay Powell will end QT. Most likely he will let pre-payments on MBS do its work as they roll-off the FED's Balance Sheet. The best we can expect (short of a full blown credit crisis) is a 2 handle in front of the FED Fund rate.
Of course it will are you kidding not booming but regular market Condos have a diff Single family homes is totally different condo prices are different bread of people. Also in the long run the GTA will still be a good investment.
Most expensive cost of living for most people is the government, and inflation tax is the highest and the most unfair form of the taxes. If people want and expect government fix their problems, it is not free and it won't be on the shoulder of the rich, no matter how they try to sell that policy to public, it is always middle class which pays the most, and now middle class slowly disappearing
Enjoyed this conversation-great moderating.. It is slightly depressing that nobody has anything positive to say about solutions. How can we get back to a point that regular wage earners have secure housing? How broken are we in Canada? Workers get such a raw deal. Nobody is talking about mass public housing, fair taxation where the wealthy can’t hide their wealth and taxing assets capital gains fairly. Regular income earners need a break. But when CMHC makes comments like that, you know who they care most about - investor class. Steve’s remarks on who is buying shows exactly how important it is to deal with class issues fair and square. I remember when regular people could live in downtown Vancouver-the arts and music scene was so vibrant. The local vibe was so strong-Financialization of housing wrecks communities
this is dumb.. home price will raise they are not going down when interest rate will go down home price will go up is simple as that and be ready because in 2025 construction worker hourly rate will go up to our new convention so contruction cost will be higher. ( im electrician worker ) built more then 3000 home!
@@CalCalCal6996 even if they is a signifiant recession price will go up because when a recession occure gouv have to cut rate and when they cut rate people are allowed to burrow more.. and home are restricted by land its not like condos when they can build a X number on a land its only one home for a specific land.
Have patience. Go in vacation. A new type of real estate is coming in GTA Ontario this 2024 fall. Welcome to the new normal. Why? #CristianEnache #Realtor #Realestate
Home prices are falling. Average prices is not the right statistics data to take in consideration. 2 x 10 million homes get sold and are added to 20 x 1 million houses. Canadians and Realtors are counting on the wrong statistics. Right numbers, wrongly used for the right purpose. None of my clients are using average prices and anything average as data. Everything is so local, that it makes me laugh. Pathetic.
Negative cashflow =/= losing money. Buying a gold coin (or bitcoin) is negative cashflow, putting your money into an RRSP is negative cashflow... etc etc etc. You can be extremely negative cashflow (short amortization period) and still be making a ton of money for tax purposes (rents exceed costs). Anybody that says you are losing money in a negative cashflow position (like Steve) you can immediately know they don't know what they are talking about. Investors are not the ones losing money during a down turn, investors buy based on a cap rate.... which hasn't been good since 2018, which is the last time I actually bought something..... who actually is losing money is all the end users that paid top dollar that the investors wouldn't. If prices do come down (they won't), and rents keep going up... that means cap rates are going up which brings investors back into the market, not investors leaving the market..... as usual the talking heads describe the opposite of what is actually happening.
There's a difference between funding an RRSP and constantly losing money on a condo you're trying to rent out but can't get enough money to cover expenses. It's getting tight for me as well, but deluding ourselves won't help.
Agreed lol. Negative cashflow is not remotely the same thing as losing money. Most realtors dont understand basic arithmetic which is probably why they're realtors. Any asset that appreciates more than its negative cashflow is not losing money. This is trivially observed by using leverage to buy stocks or other assets. You're negative cashflow (paying interest rate on the leverage) but if the value of your assets are greater than that negative cashflow you are in no way losing money (simplified case not taking taxes into account).
@@ifh4030 actually there isn't. You can get an rrsp loan and so be leveraged and paying monthly (negative cashflow) to fund it...... and the rrsp can go down and be worth less than the loan. You aren't losing money until rents are below costs (interest etc).
@@GreenBeanGreenBeanrents are waaaaay below the costs of just about everything bought recently. Especially by “investors” that kept leveraging their properties up to 80% to buy the next one. Many are lose a $1000+ a month.. and if their investment drops in value by 21% they’ll be in bigger trouble come renewal time..
That makes sense. At least half of the year someone needs to live there. Is that what you’re suggesting? My opinion is that short term rentals should be registered and required to pay into city/regional tourist boards, just like hotel/motels. They are acting as a short term accommodations, though should be treated and taxed as such. If this then causes them to fall in number because they are less profitable, so be it.
Let me explain it simply: If banks won't lend money out because buying houses is now too high of a risk, and young buyers don't have the income to buy a new build anyways, then sales will continue to drop lower each year. Sellers can keep their houses as long as they wish, there won't be anyone to buy. House prices will stay high, sales will go to zero over the next decade. Then people die from old age, and again; nobody there to buy at these high prices, so estate sales at 50% or less.
Recessions are part of the economic cycle, all you can do is make sure you're prepared and plan accordingly. I graduated into a recession (2009). My 1st job after college was aerial acrobat on cruise ships. Today I'm a VP at a global company, own 3 rental properties, invest in stocks and biz, built my own business, and have my net worth increase by $500k in the last 4 years.
Let's face it... buying more stocks & index funds during stock market corrections and bear markets is scary. Which makes it really hard to do for most people like me. I have 260k i want to transfer into an s&p but its hard to bite the bullet and do it.
The issue is people have the "I want to do it myself mentality" but not equipped enough for a crash, hence get burnt. Ideally, advisors are reps for investing jobs, and at first-hand encounter, my portfolio has yielded over 300% since 2020 just after the pandemic to date.
To be honest, I've been wary of banks for a while, but I wasn't sure how to speak with an advisor first. Please let me know who your adviser is if it's okay; I need some recommendations.
Svetlana Sarkisian Chowdhury a highly respected figure in her field. I suggest delving deeper into her credentials, as she possesses extensive experience and serves as a valuable resource for individuals seeking guidance in navigating the financial market.
I just googled her and I'm really impressed with her credentials; I reached out to her since I need all the assistance I can get. I just scheduled a caII.
From $7K to $45K that's the minimum range of profit return every week I thinks it's not a bad one for me, now I have enough to pay bills and take care of my family
I agree just reached my goal of $100k monthly trade earnings. Setting realistic goals is an essential part of trading
How does this trading stuff work? I'm really interested but I just don't know how it go about it. I heard people really make it huge trading.
Get yourself someone like Stacey Macken who understands the market very well and is also a professional in placing trades. That's the key
Wow! Kind of in shock you mentioned expert, Stacey Macken. What a coincidence!!
Stacey's understanding of market indicators is impressive. She knows exactly when to enter and exit trades for maximum profit. her signals are top notch .
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. Sure I'm not alone in my chain of thoughts.
Buy now, home prices will not go lower. If rates drop, you can refinance
The government will have no choice but to print more notes and lower interest rates
Well i think, home prices will need to fall by at least 40% before the market normalizes. If you do not know whether to buy a house or not, it is best you seek guidance from a well-experienced advisor for proper portfolio allocation. So far, that’s how I’ve stayed afloat over 4 years now, amassing nearly $1m in return on investments.
this is quite huge! what have you invested in ? much more info needed please ...I think this is something I should do, but I've been stalling for a long time now. I don't really know which firm to work with; I feel they are all the same but it seems you’ve got it all worked out with the firm you work with so i surely wouldn’t mind a recommendation.
@@williamDonaldson432 this is quite huge! what have you invested in ? much more info needed please ...I think this is something I should do, but I've been stalling for a long time now. I don't really know which firm to work with; I feel they are all the same but it seems you’ve got it all worked out with the firm you work with so i surely wouldn’t mind a recommendation.
GDP's already negative, the housing market's already crashing (see all-time high number of price reductions without any sales still), all-time consumer credit card debt, unemployment is skyrocketing and will surpass 2009's 10% peak. Homes and stocks will crash 60%. It's literally 3rd grade math. It was always inevitable. Already seeing it in every single asset class other than the Crypto market ....I've been engaged in active trading and managed to grow a nest egg of around 2.3Bitcoin to a decent 24Bitcoin....I'm especially grateful to Linda Wilburn, whose deep expertise and traditional trading acumen have been invaluable in this challenging, ever-evolving financial landscape.
She's often interacts on Telegrams, using the user-name.
@Lindawilburn
In a field as rapidly evolving as cryptocurrency, staying updated is crucial. Linda’s continual research and adaptation to the latest market changes have been instrumental in helping me make informed decisions.
Nice, I was just hodling before I found Wilburn. In my opinion she is the very best out there.
When it comes to investing, we want our money to grow with the highest rates of return, and the lowest risk possible. While there are no shortcuts to getting rich, but there are smart ways to go about it.
Even if prime drops to 3.5% it doesn’t change the fact that wages haven’t kept up with home prices. It doesn’t change the fact that at these prices even with a 20% down payment the buyer can’t get a mortgage based on the average income. If home prices don’t drop substantially home sales will remain slow until wages increase back to a normal wage to home price ratio.
And don't forget to include the overall cost of living i:e: food, fuel, and TAXES.
You guys should make a video shedding light on the tenant landlord board. I find it absurd that landlords are still waiting over a year to get a hearing.
I told my kids to get out of this country.
I’m sorry to hear that. I’m glad I, and my siblings, have had the ability to stay in Canada. I’ve bought a home, my sister and her fiancé are homeowners and our two younger siblings will hopefully be able to when they are a few years into their careers.
And go where?
@@CorporateShill66 in a low tax growth country. Entrepreneurship here is on palliative care. They can always come back to vacation here.
@@DarR1299 like?
@@dougpatterson7494 I'm very happy for you. I just don't see any real growth opportunities for them here.
@14:00
No one is buying condos because Vancouver and Toronto way over-built condos.
People talk about a "housing shortage" in Canada. But it's shortage of family-sized housing, not of shoebox sized housing.
We have more condos than we need and the only reason these were selling was due to speculators and investors who were enabled to bid up the prices by ultra-low interest rates.
Now that the investors have pulled back the real demand for micro condos is clear: there is none.
So we have a population surge while at the same time massively increasing development fees on new homes which means the the young are effectively subsidizing the old.
My mortgage will renew in the late spring of 2026, hoping I can lock into a 5 year for around 4% ... think that might be possible?
All you need is one person to sell at a lower price which then sets precedent for the rest of the area. Some may hold out but can every seller afford to hold. Those who do try to hang on are chasing the market lower.
You are so correct. Look around you; look at all those BMW's, Teslas, Porsches, Lexus's, etc......do you think the spending shift in the Canadian homeowner culture is indicative of financial wisdom - - - or maybe closer to the opposite???
Don't forget to factor in the cost of food, fuel, and TAXES across Canada. It's not just housing that's hurting working Canadians.
Back in the day the govt would incentivize something that was of need to the country.
At this point all levels of govt need to eliminate all fees and taxes on new builds and raise existing property taxes accordingly to fill their financial void.
That's absolutely what's needed. It would solve the problem, but would hurt the home equity built up by most Canadians. I fear we'll never take that step.
@@duncanmccabe974
I bought my last house which I live in now, in 1996 for 128k.
I planned on it being Worth 350 or 400k when I was 60.
I'm 61 now and it's worth 1.1 mil.
I'm fine with it going down 40%, it will still be above my retirement expectations, and so are all my buddies.
Anyone who bought 20 or more years ago who is reaching retirement in the next 10 years who says their retirement was based on their house being worth a million bucks is LYING.
@@Stormshfter that’s a healthy perspective. If enough Canadians recognize the problem for what it is we could fix this. 40% correction sounds aggressive, but it may be needed
prices in Vancouver haven't fallen substantially yet because people are greedy, plain and simple. So until it becomes absolutely necessary for someone to sell (ex. loss of employment) they will hold on to the last minute. But this is coming !!!
Greedy ?
Greed is just a sub-category of ignorance. People in Vancouver lucked into stupid gains over the last generation, and now the pendulum is swinging towards the stupid losses zone. Can't be stopped this time.
Like john said around the 24 min mark, sellers are anchoring their asking prices according to peak prices. Where would you say the buyers are anchoring their bids at?
"Why would I drop 250k to pay 1k more a month than I do in rent"
Line of credit and credit cards to pay mortgage can only last so long....
John got Fired UP... want more of that! lol
Steve hit the nail on the head - Low property taxes and rising development fees are transferring wealth from the young to the old.
Boomers will say they care and want their kids to be able to afford a place, but good luck finding one that's okay with paying higher property taxes on their $1.4m home that they bought for 200k. Instead we'll charge the newly forming family an extra 50k and call it a day.
I shouldnt say this because it might give the government ideas, but if you raise development fees to 1m dollars per house you can set a floor on home prices and make people even richer!
I'm sure someone out there thinks this is a genius idea.
Dude in BC if you are over 55 you can defer your property taxes forever.
Here in Nova Scotia we are still seeing home prices increase in most regions. Inventory is increasing because of properties that are overpriced as we have had a spike of new listings.
Construction companies will accept a bid. And then go immediately into a hiatus. And leave all their equipment on-site for months. Why is that? Is it some sort of contractual leverage? Does anyone have a deep dive into municipal tort law?
Great show as always everyone. Thanks for keeping us informed!
Just a question about development charges etc. People talk about them being a "tax" which increases "cost" and thus discourages consumption. My question is this - in Real Estate, where land is a key component of the underlying input costs but where there are no "production costs", it would seem that a real estate tax does not actually increase the ultimate cost to the consumer but instead is a confiscation of value from the underlying land. Since a project development will be priced out based on the underlying market - the "plug" is land value - and ultimately the taxes ensure land values don't increase more. If the tax is removed, it would either translate to more profits or push up land prices. This is especially true where land is a very significant component. If land was basically negligible, then it would be a true cost increase but in the case of Vancouver and Toronto I would say development charges are merely pushing land prices down. Thoughts?
Great question, and I will confess I don't have a perfect answer, but here is what I suspect would happen.
If you cut development charges by $100K per unit, just as an example, home buyers would not see prices fall by that same amount for each unit. They will see some price drop, but part of that $100K will be absorbed by land values and developer profits as you suggested.
But I suspect the timing of when that happens is relevant. In a market like today, when nothing is selling, I suspect you would see more of that cut in development charges flow through lower prices because developers would rather sell units vs sit on land.
If development charges are cut during a booming market when demand is strong and builders can't bring enough units to the market - and buyers are fine with current prices, in that scenario I suspect your argument would more likely hold where more of those cuts would drive up land values and profits vs reducing prices
@@john_pasalis sounds correct - there is a big timing issue here in that land buys are always a spec trade as you don't get to do your pre-sale the same moment you buy your land. This is why on the way up - things can get very profitable but on the way down - they can be a disaster and cause the flow of units to trickle as developers try to be able to close with a margin. Small one-time thinly capitalized developers won't make it and that is what we see now.
Detach home sellers are still wanting to get a 6-10% lift per year from their recent purchase. Good luck with that.
Can't wait for the day when real estate "experts" actually take some responsibility for the situation that their clients (the non-experts) find themselves in......instead of just being confused about those clients being reluctant to lock in losses. Now all of the real estate pros are suddenly conservative about the calculus that goes into buying and selling choices....oh - - - and they also happen to be "experts" about psychology and the phenomenon of sell-side hesitation.
Most of these "experts" should not be doing nearly the amount of yammering they are doing right now. You are damaging your careers. Regarding the statement that in the major Canadian markets "homes are purchased by capital and not by incomes"; did you explain the unsustainability of this anomaly to your clients before they committed??? Did you give them any insight about possible negative hypothetical realities that can actualize when individuals compete against institutional/professional money? Because that's been the hallmark of the Canadian bubble for almost 20 years now.
You guys have the attitudes and corresponding insensitivity/obliviousness that can only be born from a bubble market......when it's really hard to make profoundly bad decisions because of the sheer power of the upward trend. Now you are all being exposed; not just by the data - - - but by your first-person narratives. As someone who has been a trader and handled clients for almost 30 years, I am fascinated that I am actually witnessing the materialization of cautionary tales we were all told at the very beginning, when we were deciding what kind of professional we wanted to be.
I am a regular listener. All of you are great to listen to.
It's a catch 22. Supply will not improve until prices rise. However, prices can't rise in the absence of demand.
i think that that the key driver of teh condo market are the out of control condo fees. You get some level of foresight of interest rates (even if not control), but no real logic is to condo fees.
Most investors are waiting for 2026 when there will be no new condo builds coming onto the market. Combine that supply crunch and lower interest rates is a recipe for 🚀
42:05 PREACH John, I love your 'let them eat cake' comment about CMHC attitudes re: Air BnB. We need rational housing policy NOW!!
Great discussion. Dont often see Real estate sector admittto the softness of the market, and prices. It would be nice to hear from other experts like David Rosenberg
NOTICING significant increase in FOR RENT signs in front of apt buildings in North York Landlords spending $ new larger signs to attract LIKELY getting difficult to rent at these 'all time high asking prices'
People who survived 2008 - 2011 recession in Canada will not ever thing about spending their lively hood and saving in Canada. One would try their best to move to US instead of Canada.
Greed is last thing that dies.
I hope prices start to decline. Most inventory sitting on the market is overpriced and undesirable. Even if we're in a buyer's market, it's still hard to see families work so hard to pay 2 million for a decrepit home. That's not good for anyone.
Home prices are down 5% yoy house for house. The average is down 1% but the home composite index is down 5%. That is to say that the same house sold a year ago was sold for 5% more.
I’m in a wait and see loop. The extra money I have for my home upgrade is in USD equities. The last few years of waiting has worked out, but it’s less clear these days.
You know why home prices haven't fell
For some reason Podcast for this episode is yet to be uploaded (Castbox).Usually podcast upload seems to be delayed by a week.
Thank you for listening! There is a gap because our podcast drops new shows weekly first thing Tues morning - so videos go live on Fridays and that podcast that Tuesday - so shouldn't be a week long delay but of a few days. We'll look into optimizing our schedule further as we can! ~ Urmi
@@MoveSmartly Thanks Urmi !
IMHO, I don't think Jay Powell will end QT. Most likely he will let pre-payments on MBS do its work as they roll-off the FED's Balance Sheet. The best we can expect (short of a full blown credit crisis) is a 2 handle in front of the FED Fund rate.
Municipal taxes are relatively stable??
5% interest rate people panic, seriously get hold of your investment
Of course it will are you kidding not booming but regular market
Condos have a diff
Single family homes is totally different condo prices are different bread of people.
Also in the long run the GTA will still be a good investment.
Most expensive cost of living for most people is the government, and inflation tax is the highest and the most unfair form of the taxes. If people want and expect government fix their problems, it is not free and it won't be on the shoulder of the rich, no matter how they try to sell that policy to public, it is always middle class which pays the most, and now middle class slowly disappearing
Great episode!
Enjoyed this conversation-great moderating.. It is slightly depressing that nobody has anything positive to say about solutions. How can we get back to a point that regular wage earners have secure housing? How broken are we in Canada? Workers get such a raw deal. Nobody is talking about mass public housing, fair taxation where the wealthy can’t hide their wealth and taxing assets capital gains fairly. Regular income earners need a break. But when CMHC makes comments like that, you know who they care most about - investor class. Steve’s remarks on who is buying shows exactly how important it is to deal with class issues fair and square.
I remember when regular people could live in downtown Vancouver-the arts and music scene was so vibrant. The local vibe was so strong-Financialization of housing wrecks communities
@headab9027 - Thank you for watching and for the kind words! ~ Urmi
Housing Price is crashing!!!!! 300k less asking price 🙂↕️😩😩😩😩
this is dumb.. home price will raise they are not going down when interest rate will go down home price will go up is simple as that and be ready because in 2025 construction worker hourly rate will go up to our new convention so contruction cost will be higher. ( im electrician worker ) built more then 3000 home!
Unless there's a significant recession...
@@CalCalCal6996 even if they is a signifiant recession price will go up because when a recession occure gouv have to cut rate and when they cut rate people are allowed to burrow more.. and home are restricted by land its not like condos when they can build a X number on a land its only one home for a specific land.
why would the prices fall?
It won't fall because of sour grapes...
The market has always been volatile and cyclical
@@williambuck7549 yeah wondering what the heck their talking about. unless full time recession or moon crash
Have patience. Go in vacation. A new type of real estate is coming in GTA Ontario this 2024 fall. Welcome to the new normal. Why?
#CristianEnache #Realtor #Realestate
Home prices are falling. Average prices is not the right statistics data to take in consideration. 2 x 10 million homes get sold and are added to 20 x 1 million houses. Canadians and Realtors are counting on the wrong statistics. Right numbers, wrongly used for the right purpose. None of my clients are using average prices and anything average as data. Everything is so local, that it makes me laugh. Pathetic.
Supply side economics is the only solution.
You kids are too young to remember this pattern. Wakie, wakie. How old were you folks when this happened before, ten?
Goodbye Canada
Time to buy.
For condos? Great time to buy.
Home prices may dip but they will nEVER fall.
GREED !
Negative cashflow =/= losing money. Buying a gold coin (or bitcoin) is negative cashflow, putting your money into an RRSP is negative cashflow... etc etc etc. You can be extremely negative cashflow (short amortization period) and still be making a ton of money for tax purposes (rents exceed costs).
Anybody that says you are losing money in a negative cashflow position (like Steve) you can immediately know they don't know what they are talking about.
Investors are not the ones losing money during a down turn, investors buy based on a cap rate.... which hasn't been good since 2018, which is the last time I actually bought something..... who actually is losing money is all the end users that paid top dollar that the investors wouldn't. If prices do come down (they won't), and rents keep going up... that means cap rates are going up which brings investors back into the market, not investors leaving the market..... as usual the talking heads describe the opposite of what is actually happening.
There's a difference between funding an RRSP and constantly losing money on a condo you're trying to rent out but can't get enough money to cover expenses. It's getting tight for me as well, but deluding ourselves won't help.
Agreed lol. Negative cashflow is not remotely the same thing as losing money. Most realtors dont understand basic arithmetic which is probably why they're realtors. Any asset that appreciates more than its negative cashflow is not losing money. This is trivially observed by using leverage to buy stocks or other assets. You're negative cashflow (paying interest rate on the leverage) but if the value of your assets are greater than that negative cashflow you are in no way losing money (simplified case not taking taxes into account).
@@ifh4030 actually there isn't. You can get an rrsp loan and so be leveraged and paying monthly (negative cashflow) to fund it...... and the rrsp can go down and be worth less than the loan.
You aren't losing money until rents are below costs (interest etc).
@@GreenBeanGreenBeanrents are waaaaay below the costs of just about everything bought recently. Especially by “investors” that kept leveraging their properties up to 80% to buy the next one. Many are lose a $1000+ a month.. and if their investment drops in value by 21% they’ll be in bigger trouble come renewal time..
@@JustShaneB investors haven't bought anything in 5 years lol, the numbers haven't worked for over that long
6month limit on airbnb needs to be a thing
That makes sense. At least half of the year someone needs to live there. Is that what you’re suggesting?
My opinion is that short term rentals should be registered and required to pay into city/regional tourist boards, just like hotel/motels. They are acting as a short term accommodations, though should be treated and taxed as such. If this then causes them to fall in number because they are less profitable, so be it.
More and more regulations and intrusion by governments??
Let me explain it simply: If banks won't lend money out because buying houses is now too high of a risk, and young buyers don't have the income to buy a new build anyways, then sales will continue to drop lower each year. Sellers can keep their houses as long as they wish, there won't be anyone to buy. House prices will stay high, sales will go to zero over the next decade. Then people die from old age, and again; nobody there to buy at these high prices, so estate sales at 50% or less.
Who cares!!!!
Van life !!.. here I come !!!