The Nightmare Condo Market: How to Survive
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- Опубліковано 2 жов 2024
- Are you feeling the pressure of the condo market downturn? You're not alone. In this video, we break down the realities of dropping condo values and rising interest rates. Discover practical strategies to manage negative cash flow, insights on long-term benefits of owning versus renting, and tips for making the best decisions in this volatile market.
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You have sympathy for the investors but not for the first time buyers. People who buy to live don't care what their home price is. Investors, go away from housing! Make some better use of your money. Set up a business. Do something that will add value to the society, not just your own pocket.
That's a good point, I do feel bad for first time buyers (or those that do not have the means to come up with the down payment and mortgage qualification. However, that's not how the world works. With the long lead times for new high-rise housing to be created, the majority of purchasers will be investors that want and need a long closing. Without these investors, the projects would simply not get built, thereby causing the new supply of housing to stall.
Every market needs investors and speculators, otherwise that market wouldn't exist.
Do you seriously think that GDP matters if GDP per capita is going down? If you want natural born citizens to riot and become extremely xenophobic, lowering the per-capita GDP while saying "it's okay because of immigrants boosting the overall GDP" is how you do it. You are literally saying "it's okay for everyone to suffer declining quality of life as long as the line on the chart keeps going up." You sound exactly like an out of touch political elitist.
I'd rather live in a country with declining overall GDP if the per-capita GDP is increasing.
No it's not OK, I'm not saying that at all. I'm saying that it's a complex issue, and CPP needs to be kept up by more tax revenue.
Completely agree with Brandon on this one. As a struggling domestic Canadian life’s tough.
You don't understand the market. Let me explain. A real estate market grows like a pebble thrown into a pond. It starts with 6:07 single family dwellings, mansions and well located commercial properties. It spreads to simple sfds to duplex and then lastly to condominiums. You can gain on all areas in a growing market, but when it collapses, it hits condominiums first. A high-end, well located luxury home could escape from the collapse completely depending on the depth and lengths of the collapse. This market had one critical difference that will extend the recovery to the limit as boomers with large families are replaced by genZ and other low birth generations. To avoid this, you might consider East Coast properties if you can find a job out there, but as a retired 70 plus, i moved overseas to the Philippines where the demographics and GDP are outpacing anything that the west can produce.
I definitely understand the market, I've been in this for almost 2 decades. I don't understand what you're saying anyway, are you saying that condos are the first domino to fall, then it will spread? And to just move to the east coast instead? There's pros and cons of owning in a major city vs a small town. Depends on your strategy.
@KennethYimHomes I got my license in 1988, worked with Henderson, the biggest developer in the world at that time, and was a professional witness to the Barrett commission into the Leaky Condo investigation. I was the editor and publisher of Industry News, a support magazine for property professionals from 1998 to 2001. As a professional, you should already know this stuff, but sadly, you just don't get it. Anyone buying property in larger markets needs to have their head examined. Taxes, zoning, HOAs, and bylaws have eliminated the benefit of investing a lifetime of servitude just to pay off a mortgage. I don't really care if you understand or not, but this misinformation you're spreading will only perpetuate the misery. There needs to be a major migration to smaller communities to save any kind of family lifestyle, but the 15-minute agenda is destroying it all.
keep selling that "dream" of passive income while going into debt to rent out...
Yeah eventually it'll be in the favour of the landlord, when there's less leverage used.
1:37 - people hate on landlords because they are mean to tenants. Tenants do not care if the landlord is making profit or not.
PS: I am a landlord and my tenants love me
Same. Tenants are like customers, treat them right. But if you read the comments below, it seems that many people really hate landlords.
Interesting thoughts. But the population growth for GDP has been debunked, as capita GDP goes down (everyone feels poorer) as productivity hasn't moved. And we're on the cusp of mass automation where people increasingly cannot offer productive value to society (AI). Interest rates are a hopeless central bank game. Low rates = price inflation. Handouts/bailouts = dollar debasement. Close the wealth gap (wealth redistribution) and your best people leave in droves.
And those remaining will own nothing and be happy.
Your math isn’t math-ing!
If their is no cash flow you stay away from that business.
We are going to have a massive correction soon.
Time for all speculators to wake up.
I literally said in the beginning of the video that it's easy to say this as an outside perspective, but what happens if you're in the situation? Wake up? The speculators are awake. They're just trying to survive. And it's pretty clear that they've stayed away from the business, as new construction sales have plummeted over the past two years. While there will likely be a price decline in the near term, I don't think values will go to zero. There's too many people in the city for that to happen, for the equilibrium price to massively drop.
I think in the long run, because there haven't been pre-sales, there hasn't been new launches, meaning no new construction, meaning that there's been a deficit of construction for the past 2+ years. Once the existing inventory gets absorbed, there will be another housing crisis in the condo market. My long-term prediction anyway. Not trying to fuel the speculator market, just giving a longer term outlook on the state of affairs.
Nope, I'm not expecting prices to stop dropping if I buy. I'm just expecting to live in a nice place and not suffer with insane expeculation.
Btw, beautiful view in Broadview avenue. I used to sit on that spot and enjoy a nice coffee 😊
you have no clue
Oh yeah of course not, I've only been doing this for nearly two decades, and a landlord for a bit longer than that.
I’m pretty sure we have too many immigrants…
We need to reduce numbers in my opinion Canadians are struggling to compete with everyone for employment & there’s a housing shortage due to the mass number of people arriving here.
You can thank the current federal government in power next year at the polling stations.
Guys, you are not chatting among yourself. You are communicating your ideas/ information to the viewers. Keep your sentences short and precise. You are using casual language and accent as if you are having a casual chat among you two. That way it becomes difficult to understand what you really want to say. Also you end up talking for 1 minute for something that could be said in 5 seconds. Although I liked your ideas but I could not stand your delivery style. I gave you a thumbs down and closed the video halfway. This is meant to be feedback for you not a hate message. I am taking time to write this comment because I liked your ideas. Otherwise I did not even have to leave a comment.
Thank you for this message, I sincerely appreciate the feedback! Yes, we need to have more curated discussions, with an agenda. No offence taken, I much appreciate the comment!
The investors that bought several units on leverage will be forced to sell. It will set the new price for the building. Not too many people will want to catch that falling knife on leverage.
Yes it's true. I've noticed that it's quick to fall, and quick to rise. As long as you can weather the storm, and your debt is being paid down, the dream of having a paid off asset is wonderful. Tenants can help with accelerating that pay off, but they shouldn't be burdened with the entire debt.
Dang, sorry you all got rekt on your condos. At least you don’t have to worry about the new capital gains taxes 😂
LOL it's OK I'm in it for the long run. I've done in well in the past, and I know there's ups and downs. This video wasn't about me anyway, it was for other people in this situation that don't know what to do.
Interest rates are NOT high. They are higher than they were over the last 10 years.
They’re high, given the Canadian household debt loads
Speculators are learning about risk managment. I'm not sad for anyone that loses on there investments, that's how it goes sometime.
I think you should take another look at the immigration rate, student visas are coming down. A lot of students are protesting changes. We also have a lot of under employed immigrants that are not buying a house anytime soon. The avg age of international students is 23 . "2023 survey found that 24 per cent of first-time homebuyers were under the age of 30; 33 per cent were aged 30-34; and 43 per cent were aged 35 or older." Unless thier parents are buying, or landlord see a future where there are more students then 1.2 million come each year, i don't see a huge driver.
For sure, this video isn't for you. It's for those caught in it.
If people get wiped out why does anyone care? The asset just changes hands no biggie. If someone is willing to lose 2k a month and has to babysit a tenant to get it that person needs to take a long hard look at themselves. When the 1% rule applies then it’s a good time to be a landlord. Maybe.
The 1% rule isn't coming back in Toronto... then again, you don't have to invest in Toronto.
No one cares if someone else gets wiped out, in fact, they're probably being very sharky. It's more so what happens if you're the one in that boat? That's what this video was supposed to address, but I see a lot of keyboard warriors that probably don't own anything in the comments.
Unfortunately mtg never goes down, you are stuck with it for ever. Now best to rent and invest in a gic. And I'm a realtor.
If you remortgage (when you have a lower balance), or if interest rates decrease on renewal, the payment definitely goes down.
Even if it doesn't go down, rent will most likely go up, over time. The mortgage will eventually be paid off.
Anyway, to each their own. There's benefits both to renting and to owning.
The muppet boiler room condo flipping market is dead 😂
No one said anything about condo flipping, I'm saying that this has to be a long term play, like all real estate holdings should be.
You got caught in your own game, condo has no value that's why.
It still needs to house people, and it's the most affordable housing type out there.
Does real estate make sense as an investment in Canada. I’ve heard these prices and I would be surprised that you could make any money at all in Canada.
I guess you could say the same for Manhattan or Taiwan or Hong Kong or London or any other expensive major city in the world. The numbers are terrible, but the values do hold up in those cities for the most part.
Real Estate is not an investment anymore unless you bought pre 2015. You’ll be paying more in interest than the property is worth in Toronto! Unless you put 50% down, you won’t be making money on it, and if that 3% appreciation a year IF anything… Stock market is much safer.
In the Midwest US I can currently get 25% return sometimes 30% on duplexes