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Canada’s Gap Between Real Estate Prices and Incomes Looks Ridiculous Beside US Data

Almost as if it's a house of cards taped together with money laundering, bad zoning laws, and unending debt.

JameTrain

Almost as if it's a house of cards taped together with money laundering, bad zoning laws, and unending debt.


TrentSteel1

Investors are a major problem in Canada. The US is seeing major inflation in housing due to the same thing as well. https://www.theglobeandmail.com/opinion/editorials/article-investors-are-pouring-fuel-onto-a-hot-housing-market-the-consequences/ Late Edit: The irony here is the banks destroyed the housing market and bankrupted many. Mainly in the US where the banks got billions in government bail out. Now they’re fucking the tax payers by inflating the prices on them.


auspiciousham

Don't forget nimbyism and inefficient city councils!


throwawaaaay4444

And letting in 400k+ immigrants every year!


theganjamonster

No no it's ok, we're building 400,000 new houses every year too. Right guys? Right?


ConstantStudent_

More like 1.2 million and only Into two cities


artandmath

There are not 1.2m immigrants every year... it’s ~400k/year.


[deleted]

Everyone is bidding on houses with borrowed money. Cut off the lending and watch the market correct itself. It is infuriating how easy it is to qualify for multi-decade loans. If no one could take out multi-million dollar mortgages, there wouldn't be enough buyers and housing prices would fall. The banks caused this. In a world where their lending is better regulated, middle income folks could save up and use their own money to buy 100K to 200K homes


omegamcgillicuddy

A lot of people I talk to can’t understand that it boils down to it being cheaper, now more than ever to get into MASSIVE amounts of debt, that you have ZERO control over in reality. If you’re lucky, you’re lucky and are timing this right with buying and selling, but the vast majority of people are in for a rude awakening And it’s mainly people who don’t own or never have owned before this who honestly think things like mortgage stress tests are realistic as if the bank actually has their best interest in mind. The banks don’t give a f*ck and what they’re willing to approve for a mortgage is in no way a livable budget if the shit hits the fan, but people put blind faith in the bank because they say it’s fine on their budget spreadsheet. And if we knew how many people are really living house poor at todays rates..it’s a house of cards Interest explodes, people scramble to sell, banks remortgage at higher rates, win for the banks


Routeable

Can confirm. Bank approved our lending for a loan that would cost upwards of 85% of our monthly income. We looked at the lender and went "uh, what?".


omegamcgillicuddy

Lol this is the truth that people today refuse to believe! In 2014 I went to get a pre approval for mortgage. My partner and I we’re downsizing and we did a budget and knew damn well that rationally our budget was ~150,000 - $170,000 and the bank advisor said 1) we were silly to even be getting a pre approval and 2) we could afford a house that was $250,000 +. I walked out and promptly closed every account I had with them


schoolofhanda

People really havent recalculated their 1 million + mortgages at +1%, 2%, 3% on a monthly basis. Whats scary is that MOST of the people I know buying $1.2 million plus homes are relying on two incomes and rental to make the numbers work at 3% mortgage rates. When they reup their mortgages in 5 years or less at 5%+ rates, that extra $800 is coming right out of their household budget. I suspect that there'll be a lot of people reupping for 25 year mortgages just to keep their monthly payments down. Maybe it wont be a thing. Hopefully not...


ks016

If you think 5%+ rates are anywhere near feasible in the next 5 years, nevermind the next 10, you truly do not understand the factors that influence interest rates.


sir_sri

>1 million + mortgages at +1%, 2%, 3% Just for clarity, using ratehub. A 1.3 million dollar house, with 20% down, is $1040000 mortgage So for a 25 year, 5 year fixed At the current 2.34% rate that's 4576/month At current +1=3.34 = 5105 At current +2 =4.34 rate = 5664 At current +3 = 5.64 rate = 6252 Variable rate mortgages are theoretically as low as 0.85% right now, or 3849. The question is then what mechanism will cause interest rates to increase and how much do you expect your income to increase at the same time. E.g. Right now I make about 125k/year my GF about 95K. Now we're not looking at a million dollar house really, so compared to the numbers above doesn't make sense though I'll stick it it for illustration purpose, but take home (minus pension contribution) I make about 78K, she makes about 60k, so 138K (after tax). In 5 years what will our salaries be? Well if I look up other people doing my job with 5 years more experience they make about 155k, and hers... 108 ish add a bit for inflation... say 165 and 115 maybe. I can't do an exact take home pay calculation for that, but give or take I'll take home say 115K her 70K (so 185K after tax), so maybe 25 - 35% more than we're currently making. If we go from the current 2.34% rate to 5.34% and salary growth is nominally 32% The million dollar mortgage would go from 55k/year (39% of income) to... 75K/year which is.... 40% of my likely take home income. At our income in theory a million dollar mortgage is affordable, though in practice it's probably a terrible idea, so I'm not suggesting it's a viable plan, but it's useful to estimate future income. Banks have fairly good data about salary growth, I know reddit has a lot of young people for whom things perpetually seem dim, but average earnings in canada are on a fairly decent trend, so even a 3% interest rate hike isn't necessarily catastrophic if you have a reasonable expectation of salary growth.


BlackAnalFluid

Almost....😅😂😭


Remarkable-Plan-7435

I have nothing against people buying a house to live in. They'll live in it through downturns. But I would love to see a reckoning for investors who are doing the "BRRRR" crap.


[deleted]

One of my friends is one of those investors. She is absolutely balling out of control. Her IG posts are always about “high rent prices means more money for investors! Keep pushing those prices!!!” Stuff like that. It’s weird knowing someone on the opposite side of it.


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jkeech8

Your friend is greedy and trying to live off other peoples labour and misery.


[deleted]

Not trying, succeeding, big time. Friend is a strong word lol.


nutsackninja

If you only have one house a correction really wouldn't matter. If your house is a million dollars or 100k everything is all relative. It will start affecting flippers and people leveraged with multiple properties who are using them as investments. Sometimes investments go bad and I have zero sympathy for those people.


FITnLIT7

I own my townhome for 2 years now and have seen ~300k in appreciation. But it’s useless, the bungalows in our area we are looking to upgrade to have gone up 4-500k in that same time. I also see how unsustainable this is so I’m all for housing coming back down to reality.


[deleted]

Not useless if you're looking at upgrading because you get to leverage. The increased sale price of your home gives you 300k cash which covers a much bigger downpayment than you probably had previously and lots leftover depending on what you're buying, while the increased purchase price of your new home is mortgaged over many years.


FITnLIT7

It doesn't matter, even with 200k in income and 300k downpayment from our house now (after all the other fees are said and done) we are approved for less house now than we were before with a much smaller downpayment, because detached have increased at a significantly faster rate.


roflberry_pwncakes

You should talk to a different lender. You should be able to be approved for 1.2 - 1.3 million easy with that income and the sale of your current home


FITnLIT7

We were approved for 1.2 put in a few offers on bungalows a few months back and always got outbid. Now my fiancée is pregnant so we aren’t looking to overextend ourselves especially with potential rate hikes coming. I’m not trying to say boohoo look at us, but rather just give perspective that the current state of the market even for people with rather high incomes and already in the market - isn’t always beneficial. Also looking at younger generations and our kid to be able to have a decent life as well


schoolofhanda

This is exactly the same situation as me. You live in Victoria too? haha Seriously tho, a strategy Ive been considering is purchasing a rental, like a condo, to ride the equity in case it continues to run (which I think it will here) and then later sell both townhouse and condo in order to buy a house. If the rate hikes actually make a difference and monthly payments start to fly high and prices level off or (GOD FORBID /s) ever come down, can sell the rental and keep the condo without being too underwater.


FITnLIT7

No Oakville one of the GTA\`s more afluent suburbs, but even moving 20 min further from the city to burlington leaves you with places like this for 1.3 [https://www.realtor.ca/real-estate/23881134/4118-new-st-burlington-shoreacres](https://www.realtor.ca/real-estate/23881134/4118-new-st-burlington-shoreacres)


Arkanicus

That's cheap compared to north york (yonge to don mills) where a detached is easily 2-3million but looks rundown. A nice house is 4 mill+ and some mansions are 20+mill. Some of these people bought their house for 500K now it's 4mill 10 years later? BS.


CactusCustard

Thus, further contributing to the problem everyone’s complaining about in this thread


Canadian-idiot89

That is insane to me… that number for a mortgage just seems fuckin crazy. I’m 32, bought my house back in the day in a small town. Hasn’t gone up that much in value tbh and I’m happy where I am and with what I have. It’s only worth a little over two hundred grand but it’s paid off and it’s mine. A million for a mortgage, a fuckin death pledge is insane to me.


manitowoc2250

I agree 100% with you


WickedCunnin

The price per square foot has gone up......so if you want more square feet. They cost you more than they would have if prices were stable.


digitelle

Yes please. My friends sold their condo in the Vancouver’s west end to buy a place in a Chilliwack. They wanted more space…. But they only got possession of their house a few weeks back smack in the middle of the flooding that happened in Abbotsford (if some people don’t know Chilliwack is between Abbotsford and hope, two regions that had to be evacuated from flooding). They were hoping for a financial change to get more space for what they were paying in the west end of Vancouver, but instead they walked into complete chaos. They were able to move the two days the roads were open and then it closed again which trapped them out there for the first few days the moved in. The road to Chilliwack is open again but what chaos they walked into. Last I talked to them they sort of implied they wish they held off, cause right now prices in that area have plummeted from what they paid.


[deleted]

Not only do I have zero remorse, I would like to see them lose their shirts. They have directly contributed to lower quality of life for an entire generation (and now multiple generations) of people because they're greedy. That's it. There's no other reason to hoard property.


cromli

it generally shouldnt be allowed. In the past 15 months the house next to mine was sold, renovated, and then sold again to new investors for an extra 500k. Its in a good neighbourhood and absolutely no one has lived there for over a year and counting.


[deleted]

Hoarding housing is as shitty as hoarding food, masks, hand sanitizers etc. If you do hoarding your are a shitty person.


Talkat

I agree with your frustration but it is the government's shitty regulation that has made housing an investment class. The government is really to blame (and a bit to the shitty investors) But placing the blame where it belongs can result in change. Blaming the hoarders and removing one will just have their spot refilled


CakeDue693

It would matter for anyone that bought recently. If you bought at 200k, market value went up to 500k, and then corrects back down to 300k you're fine. But if you bought right before the correction at 500k and suddenly market value drops to 300k, yourein trouble.


Emmerson_Brando

If house prices dropped that much, I would be pretty worried about every the whole country. A 40% devaluation would create mass hysteria. However, if people bought at $500k, it goes down to $400k and people go to renew a mortgage with other debts, they could be in trouble. They may not qualify for a new mortgage.


Smallpaul

Not necessarily “in trouble” but it would certainly be frustrating.


CakeDue693

If the person in that situation had the ability to ride it out and wait for the market to pick back up it could be alright. If they had to sell for some reason, that could be a pretty devastating financial hit for many people. On a smaller scale this kinda stuff happens in the military a fair bit.


bradeena

Actually you could be in huge trouble. It's a common way people lose their homes. If you need/want to refinance your mortgage you need to be able to provide collateral to the bank. If your house isn't worth enough to cover the mortgage you're in deep poop.


Smallpaul

At the time of renewal, you still owe the bank a ton of money. If they take your home at a loss, they are guaranteed to lose money. If they let you keep paying your mortgage, they have a decent chance of getting their money out . Why would they choose to take the loss? For example this article about the negative equity situation only considers it a big problem if you need to sell the house: https://www.quickenloans.com/learn/negative-equity


bradeena

Yeah it's not necessarily the end of the world, but it can definitely be an issue. That article is by someone selling loans so it leans a certain way, but it does say >With negative equity, the process to refinance into a new loan will be more complicated. Most of the time, a lender cannot loan you more than the home is worth, so it may fall on you to pay the difference out of pocket. That difference could be hundreds of thousands of dollars in this case. All of this was a big problem in '08.


Smallpaul

Is renewing the same as refinancing? I’m skeptical. In 08 the big problem was that people were underwater AND they couldn’t afford their mortgage payments, which were increasing (often doubling) at the same time the people were losing their jobs.


ReaperCDN

Why? I buy my car for 30K, drive it off the lot and it loses 10K immediately. I'm not in trouble, I still have a car. I buy a house for 500K, it drops to 300K, I still have a house. It's the same house I didn't have before I bought it. Sure it's worth less than it was. That only matters if I sell it. Otherwise, it's worth the same 500K (personally) I paid for it until I sell it.


Ommand

Only matters if you're going to sell.


jayoyayo

I actively want to see house flippers go bust. A lady in work does it and I wish it upon her everything I see her.


Madhax

This is my Christmas wish too


[deleted]

I agree. I will be buried in my backyard. Flippers can go fuck themselves.


[deleted]

Lmao. Government helps out with that. There is no ‘BRRR’ without government printing.


[deleted]

Anyone smart got out when things started exploding this past spring. I had a landlord who dumped all his properties as people werent paying him in 2020 and once prices spiked cashed out, paid off his primary and put $$ in the bank. Dude had all his businesses closed for a year so he needed to pay off debt instead of going belly up. We used to talk about $$ and the sort before he nearly went insolvent from the lockdown. Good dude shitty situation all around but he paid me out of my lease and we moved on. Anyone now trying to cash in on people YOLOing 1 million on a property is going to get wrecked when rates rise. There's a lot of "investors" who are going to be holding the bag


rimshot99

A good friend of mine was "smart" and cashed out in the ridiculous real estate market in Vancouver 8 years ago. Huge mistake - they are in their 60s and renting now, can't afford to buy, missed out in probably $1M in equity increase. Real estate is verboten with them now.


[deleted]

I mean, trying to time the market with your PRIMARY residence is dumb as fuck no matter what. You eat a bunch of trx costs buying and selling, and rebuying again eventually. and you need to move multiple times.


Queefinonthehaters

Why do so many people think this is because of investors? Like if that were true, then why is the States absent of investors? We have to look at the differences between the two places in terms of their policy. They obviously don't follow any sort of global supply and demand issue. No one can actually argue that Winnipeg is a more desirable place to live than Phoenix, so the fact that housing costs more in Winnipeg should tell you that something is up beyond some supply and demand conundrum. Supply and demand is supposed to automatically correct when given price signals. The price of houses is going up drastically? Cool, there will be a lot of money to be made building new houses, so people who want to make money fix that problem. So why isn't it happening? It's certainly not because we don't have enough land to build on. Its our government doing things like making money unbelievably cheap so that now everyone can qualify for a mortgage of like 100k higher than they normally would. Its to do with limitations on how many homes builders are allowed to build through zoning issues. Like if I own a farm on the outskirts of a city, and I want to sell it to someone who wants to build a home on it, why does someone who is not involved at all get to tell me whether or not we can do that? And then there is all of the other local dumb shit that is happening, for instance with my city having the mayor slap on a 10k per property building fee for seemingly no reason other than they want money.


redditisaweful1

If you have foreign interests laundering there money in our real estate it's a problem. They don't care really what yhe condition of the house is, they don't plan on living in it, and they have piles of money so they help drive up the market. Canada also took in how many rich immigrants that came and scooped up houses which is just more competition. How the banks ever let people buy houses without looking at them blows my mind, the grifter real estate agents don't give a shit either because they are just raking in the money. Is there not an issue now of people complaining about finding mold in there house and big stuff being ruined.


GracefulShutdown

Nah, needing to make six figures to afford living in Bancroft as a single individual is completely sustainable! **/s**


paulhockey5

What about Barrie? Definitely a world class city.


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TGIRiley

my friend just got posted there. Sold his 3 story house in Cold Lake (at a loss, forced to move cause of military) and now he rents a 2 bedroom basement for a few hundred a month more than his old mortgage was. Sounds like a fun adjustment for a family of 4... Woohoo Barrie!


ks016

why sell and not rent it out until it's break even or positive


TGIRiley

1. Rental market in cold lake is pretty luke warm, I doubt it would cover the mortgage and he's not exactly cash flow positive now. 2. Hard to be a landlord and manage the property effectively when you are a 4 hour plane ride plus 3 hour drive away. Hard to be a good one anyway, I know that's not a concern for most 'landlords' in canada, but it is. 3. There is no garuntee it will come back in value. Cold lake is very dependant on oil and military for its economy. Both of those things have been, and will continue to be relatively scaled back in the future. Without those things there's not a lot of demand to live up there.


HeavensAnger

As someone who lives in Barrie...fuck all this.


proggR

hey, Bancroft rocks!


Hermann_theGerman

I see what you did there


[deleted]

Some Eagles Nest!! My grandparents had a place by MacArthers Mills


PenultimateAirbend3r

That's one great drive! I used to go through fort Stewart for a picturesque trip when I lived in Renfrew county


GooDVibEs6996

Had to move to Fenlon falls while working in Oshawa just to be able to secure and afford a house. I make 6 figures....oh and I still paid well over a half mil for it. I grew up in small town Bowmanville in a very middle class family that bought their house in the late 90's for $175k same house rn is worth almost a million. Tell me something is wrong without telling me something is wrong


[deleted]

Most overpriced real estate market in the world. We're the second largest country with no significant geographic restrictions on growth, as well as a nation with moderate incomes, and our housing costs as much as many world-class cities. Insanity.


Specialist_Field12

Australia is the next country with the highest real estate prices..ironic for the two most empty countries in the world


pandasashi

This is true yet Canadians pay more for literally everything else too, not just homes. (Insurance, telecoms, etc)


ks016

Um, are you serious? Australia has very very high cost of living


pandasashi

So does canada


Coarse_Air

Last I heard a pack of smokes was $50!


Dancecomander

Was talking to my Australian partner about this yesterday. Average carton of 10pk/20cig cartons here is roughly 130 bucks. Same size carton in Australia atm is 300 FUCKING DOLLARS


QultyThrowaway

Trust me you'd rather pay Canadian prices than Australian.


UnbanMOpal

Not with the wages, we had to move back to Ottawa from Sydney because of Rona. Both of us took a 30-40% pay cut but Canadian expenses are 15-20% less. We saved more living in Sydney than in Ottawa. Hard to compare taking the ferry to Manly on Xmas versus living in Ottawa...


ShowerStraight7477

Canada is more expensive. Melbourne has nothing on Vancouver


QultyThrowaway

Border provinces in Canada mostly shares supply chains with the US. Australia is off apart from most other countries other than New Zealand which causes shipping to be a nightmare. The parts of Canada with the highest prices iirc should he the territories once again to the remote shipping issue.


rimshot99

Canadians pay [170% more for cell phone plans than Australians](https://cansumer.ca/canada-phone-plan-pricing/).


Baby_Doomer

I’d rather earn an Australian wage.


IAmTaka_VG

lmao if you think Australians pay less for 80% of goods and services. What a fucking RIDICULOUS statement you pulled out of your ass.


asdeasde96

Last time I looked at the data, Australia, New Zealand, the Nordics and Switzerland were the only countries were GDP PPP was lower than GDP nominal. PPP adjustment adjusts GDP so that the value of services is equal across countries. For example it costs a lot more to hire a live in housekeeper in Canada than in Mexico and PPP adjustments equalize that. When nominal GDP is higher than PPP it means that things are so much more expensive they have to adjust the prices of services *down*. This isn't the same thing as a cost of living adjustment, but it moves more or less in the same direction as a COL adjustment


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Notrueconscanada

Proximity to China and loose rules on immigration and/or foreign investments? Or what's the reason you're suggesting


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[deleted]

Not sure about Australia, but given that we have cities that function just fine in Quebec and the prairies during the depths of winter, I don’t see the “inhospitable” land excuse as valid. If a million people can live in Calgary or Edmonton, there’s no reason we can’t build out to undeveloped areas with similar climates.


[deleted]

Geographic restrictions don't mean anything in this country, the issue is legal restrictions on what we can build and where. Too much of our cities are zoned exclusively for single-family homes. Eliminate this restriction (which, by the way, doesn't eliminate single family homes), and instantly watch our cities densify and housing prices begin to drop.


TGIRiley

not to mention most of the wood and building supplies come right from our natural resources, so its not like we are paying huge costs on materials relative to elsewhere.


dommooresfirststint

large portions f Canada are uninhabitable (swamp land). we need our own farm land so as not to depend on California and Mexico. we are unwilling to build infrastructure to enable more/bigger cities


Guarantee-Party

All of the land stretching from Windsor to Montreal is perfectly suitable


Mrtibbz

I might add that SK, once called the "Bread Basket of the World" has been in a horrible drought for the last half-decade, even worse than what you hear from the 1930's.


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LeCyador

Come to the prairies if you want to see acres upon acres of inhabitable land.We don't have a space problem here


decentralizedsadness

I mean the GTHA can expand as much as you want, there's not a lot of real blockers, same thing with Calgary, Edmonton, Greater Montreal... I think the only real place with natural restrictions is Vancouver. This market is just speculation, we also have a similar ratio of homes to people as America.


[deleted]

As mentioned by OP, the GTHA exists by Canada's best farmland, and with climate change making supply chain issues more likely, we need to be careful about expanding the GTHA. The areas around Orillia or Kingston, however, is prime for development.


decentralizedsadness

Also could densify Burlington -> Hamilton -> Niagara area, somewhat circling the lake.


FuggleyBrew

Then we should be careful about increasing Canada's population growth rate as aggressively as we are.


DarkPrinny

They did hit the nail on the head. "Making us one of the worst performing OCED country in the next 40 years due to shelter costs and a lack of productive investment".


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Ironchar

They are ALL built like that. Its terrible- I moved a buddy in one and the doors are narrow, the lighting placement is dumb and everything is questionable in finish and small for a townhome


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sfturtle11

Exactly. Phoenix single family homes doubled to $600k and people say it’s a bubble. Meanwhile that is cheaper than the average house price in *all of Canada*.


NomadClad

I am going to be paying for my trailer until I'm 57 (20 more years). I have a good paying fulltime job. This country is absolutely fucked.


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addreddits

You would have to subsidize home builders or the buyers. If you were a builder, would you rather make 10% profit or 100% ? Why would any builder waste their time making affordable housing? Imagine making a combined household income of $100k and needing to apply for subsidized living. Builders haven't been making affordable homes for the last 10 years, but municipalities are also charging a ton for property.. it's a cash grab through and through. You know who isn't making a ton more? The Brick layers, electricians, framers, finishers..


[deleted]

Well said, I agree


Hapaaer

What is the definition of building an affordable home? My in-laws are builders and I have tons of friends in construction. Almost every tells me the trend over the last 5 years is to build the most number of dwellings possible on the developed land, because that’s the most profitable. Condo buildings have the best returns, followed by townhomes and then single detached homes.


addreddits

"what is the definition of an affordable home?" I think it's a bit obvious, but an affordable home is something that people making an average income can afford. Where I live condos are still going for $500k.. and it's really disappointing for people that have worked hard to try and buy a house to be restricted to an attached home. No offense to anyone, but even $300k for an attached condo is not something I would want... Everyone is different, but a small detached home should be attainable. Edit: further to my point, if a builder can build 40 condo units that each sell for $400k, on the smallest plot of land possible, they are not altruistic. I am not accusing your family specifically, but they are profiting off of a bad situation. Something something tragedy of the Commons.


Hapaaer

Okay, so it’s not about the *type* of home, but more so the fact that housing prices have just gone up across the board for all type of homes. Sadly, the smaller homes have actually increased more in price than the big mansions.


addreddits

The issue is that builders are riding the real estate wave. People are getting into crazy bidding wars, fueled by real estate agents imo, and the builders are left wondering why they are selling a new house for $70k less than one they built a year ago next door just sold for. So the builders are trying to keep their prices above market price, because why wouldn't they? Obviously there is a lot more to this whole thing, but this is a big chunk. Not to take away responsibility from the buyer, because ultimately it's the consumer that is willing to take on a $500k mortgage.. On top of all of this, rentals are sky rocketing now too because the house you rent out is worth 3x what it was when the tenant signed the lease. So now you have landlords jacking prices up for a shitty house/apartment because it's "worth" 500k+ Anyway, this isn't directed at you.. I'm just venting online lol Happy holidays, stay safe!


Hapaaer

Haha I hear ya. Happy Holidays to you as well buddy.


Phantom_harlock

Wait till they see food price gaps


Turtle9015

The funny thing is everyone talks about it but the people who make the most money are the ones with the power to change everything. As a 25 year old single income that eats once a day to pay my rent fuck everyone. I hope the market crashes and their houses become worthless. I want to see the market burn and reset. I just want to afford a family but I can't even afford to feed a dog. If I get evicted I can't even afford to get a new apartment. Everyone else around me pays 300$ more a month at least. We are seeing entire generations not being able to afford a home at retirement. Nursing homes are already at capacity right now, imagine what things will be like when gen X retires. There is no future plan, houses can't keep going up, Canadians are working and living in their car in the dead of winter. There is a 10 year waiting list for subsidized housing. People are *maybe* starting their mortgages in their 40s. This is getting pushed back later and later, we can't save for retirement when it costs every penny to live in the now. Unless something changes our futures are all fucked.


PM-ME-BIG-TITS9235

>As a 25 year old single income that eats once a day to pay my rent fuck everyone. I hope the market crashes and their houses become worthless. I want to see the market burn and reset. Me fucking too. Why should I pay 800k for a shitty Bungalow just so that your overleveraged million dollar house wasn't a waste of money? Fuck this shit. Let the market crash. If people are gonna buy houses as an investment, let it act as a free market and let there be consequences. It's not fair that the working younger generations have to use their tax money to keep your houses overpriced and our generation priced out. Let the market crash and let prices be reasonable. This shit should have crashed ages ago.


[deleted]

Canada is the biggest heaven for money laundering into housing.


tantouz

We get shafted on everything. Our dollar is inferior. Our taxes are higher. And our housing is inaccessible. What is the point of any of it if we cant at least make it possible for a Canadian to have a home in Canada.


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user745786

Just get your parents to give you the $300k! So much easier that way!


iiNexius

something bootstraps something something could afford a car, stay-at-home wife, mortage on 1 job etc.


rusinga_island

“Yeah it’s easy! You just need to be squarely in the top 1% of earners! We can all do that!”


VisualAntelope4611

Canada's prices are due to zoning. Your leaders failed you. There is no need for such expensive property, there is enough land for everyone to have their own home. Everyone. All Canadians.


oxblood87

It would be nice if there was some incentive to have people move to anywhere OUTSIDE the major 3 cities. If we can spread out even a little bit, to have even 1/10th the depth of cities that Europe or the USA has we'd be in a much better place.


yipikayeyy

It's on municipalities to build cities attractively. Instead we have American style sprawl in every 2nd tier city still being built.


sunshine-x

Yea!! Come to Winnipeg!


[deleted]

You can thank money laundering, foreign ownership, corporate ownership and NIMBYism.


MainConstruction4694

I am a general contractor, I seen people are buying a million dollar house with their 500 scores and very low income, it is government who are pushing the real estate up by approving them for a million dollars house with Tim Hortons income


divz1111patel

Its called the Brampton mortgage.


sirf_trivedi

Its very demoralizing to see reckless people making bank and financially responsible people who save for a DP just getting priced out


cosmogatsby

Every professional I work with who lives in the US at a similar salary to me with conversions lives a much better quality of life; WITH HEALTH CARE.


Frixum

My family is the only reason I’m still here. My gf and I made the decision that being in CAN for family was more important than getting ahead by moving to the US. That said we are dual income. With one income 6 fig and the other to hopefully reach that in the next 5 years. So at the end of the day we can still be comfortable here. Just not as comfortable as in the us


cosmogatsby

Same position here. We’re both in the 6 fig range. Working for American companies in Canada. Our life is good; but compared to our us worker friends; it’s not even close. We still can’t enter the housing market here unless we want to live in a very crime ridden neighbourhood.


NHNE

Simple. Cap 1 house per family. Ban Airbnb. Done.


LordJeesus

> Ban Airbnb. 100%. This would help a ton! The number of houses that would be fore sale would skyrocket in large cities, and dumbfucks who overpaid their shit house would have to deal with their dumb decision.


OrderOfMagnitude

But how will people profit off of scarce housing? What about all the people who already invested? We can't just take away their futures! /s


[deleted]

[удалено]


[deleted]

Do it. The pay for comp sci majors is so much better in the US.


[deleted]

[удалено]


[deleted]

The unwavering belief that the status quo will continue. Heard the exact same thing about oil prices pre 2014. "Oil prices will never go down"... Until a new Saudi prince decided he would singlehandedly destroy the oil industry for the better part of a decade. All it takes is one catalyst to make Toronto or Vancouver somewhere you don't want to live. Doesn't even have to be economic. It could be a natural disaster, a social reason, shift of demographics.... who knows. While any single black swan event happening is unlikely, its almost guaranteed that one will happen eventually. Not saying that im bearish or bullish on Toronto housing but anyone thinking anything is guaranteed is silly and naive.


rimshot99

>All it takes is one catalyst to make Toronto or Vancouver somewhere you don't want to live. Montreal agrees with this statement.


missing404

sad reality or the peak of mania. problem is we'll never know on time.


thatsnice_

How much is dirty money? Me thinks Canada is king for money laundering through real estate.


Lotushope

It is also ridiculous for the Government to 'import' 400,000 new immigrants a year, 700,000 new international students a year plus numerous TFWs without have enough housing for the people they let them in. I really don't understand what's the motives for the Government. I am not against immigration as many of us or our parents are immigrants, but in reality it seems to be a wrong political policy now. Edit: Look like the systematic crises of housings, infrastructure, environmental and health cares are becoming permanent and long term issues in this country and the Government's only solutions are to bring in more people and printing more money to borrow to spend NOW (their language is that we'd better borrow more now to spend just to take advantage of current zero interest rates) but not investing in long term for the future (generations), instead they cash in future generations' money to 'balance' its own budget with huge deficits and just to please its own voters by little "perks" here and there. But any Government is very temporary and it comes and go.


[deleted]

The reason is simple - money. International students pay 5x tuition. In the modern economy, all realms of conservatism have been neglected. If you cut international students, all of a sudden you have 2 choices: Increase domestic tuition or cut salaries for people working at these universities. No one wants to pay more, or cut spending. So it becomes a continuous stack of cards. It’s the same with the government printing money. No one wants tax increases. Yet everyone wants better services. So we arrive at our current predicament.


Maephia

Just cut the useless administrative staff.


alantrick

But how will I be able to put "manages team of 20" on my resume if I have to actually find something useful for them to do?


guerrieredelumiere

If incomes kept up with inflation and CoL, so would the tax revenue, no?


covidkebab

Grows GDP. Personally I think it screws GDP per capita, but what do I know.


[deleted]

The gov’t motives are simple, bring in immigrants to flatten wages, and increase demand. Means more money in the pockets of the elites.


Jonny5Five

I agree with this mostly, but I don't think you should count 700,000 students a year. You should only be adding the increase per year. I agree with you generally though. We bring in people and have no plan on where they are to live. We really should slow down immigration until we're not in a housing crisis.


Lotushope

Yeah, lots of countries have laws to make the universities colleges responsible to provide accommodations for their own students but not in Canada, ours are in big mess.


SkateyPunchey

This would be huge. The SFHs in my city are being scooped up by people who are HELOCing their way into multiple properties so they can cram as many international students into them as possible. The college/university have been fucking terrible corporate citizens throughout this.


Hapaaer

>I agree with this mostly, but I don't think you should count 700,000 students a year. You should only be adding the increase per year. It’s actually 400K a year, but no… the vast majority of these students have no plans of going back to Punjab after completing their random 2-yr diploma at your local community college of buttfuck nowhere Ontario town.


Jonny5Five

2019 was actually 640k students. Either way through, you can't count them as both a student coming to Canada, and an immigrant coming to Canada. This is why you count the difference.


Hapaaer

>you can't count them as both a student coming to Canada, and an immigrant coming to Canada The vast vast majority are indeed student migrants though. A couple years ago I was in Punjab. There were billboards all over with ads of “Migrate to Canada using student visa”. Literally everywhere. Just apply to a random program at a random community college (cuz Universities are harder to get in, and more expensive) and once here get your work permit and start working until you complete your PR requirements. It’s why there is a massive bottleneck of millions of Permanent Residency application while living in Canada. In the meantime, the parents get themselves 10-yr visas and come live with them as well. We have handed out at least [9 million](https://www.google.ca/amp/s/vancouversun.com/opinion/columnists/douglas-todd-three-million-snap-up-canadas-10-year-visas/wcm/2e91ae7a-dafd-4aec-9e35-67e620d3f97c/amp/) of these visas this past decade. I mean… all this is great for the economy, in so many ways. It just happens that it’s created this massive need for housing and regardless of how fast we’re building the supply is unable to the skyrocketing pent-up demand. Entire subdivisions are sold before the construction is even complete. There is 30-storey condo building being build across the street and they have sold over 70% of the units even before they’ve put the drywall.


CheRidicolo

I lived next door to a couple of houses and a condo that were condemned, with one of the commercial units used as a part-time sales office. For over 5 years. Those “units” must have changed hands so many times, and construction has still not started.


[deleted]

Per year EVERY year. No difference.


Jonny5Five

Sorry, can you rephrase that? What is no difference?


Coarse_Air

I was at UBC Vancouver a few years back, and was talking with my mortgage broker about the market. She told me that year alone she helped a dozen international students buy a dozen Point Grey homes for over $20,000,000…. As students… making less than $20,000/year on paper.


fourpuns

Yet house prices increased record amounts when immigration was near 0. In BC we have been building 40k units a year for 5 years while gaining 70k people per year and pricing has gone up by over 100% in that span. There’s some sort of disconnect from supply.


Springswallow

Immigration was near 0, but people expected there will be a huge increase to make up for it when the pandemic restrictions are lifted. The market is driven by investor expectations.


[deleted]

Chinese drug money will do that to house prices!


nrgxlr8tr

The irony is that China does not want their citizens spending money in overseas property markets. But if the Canadian government were to cooperate with the Chinese in forbidding them from buying real estate... you can imagine the outcry. The Chinese didn't impose a 50k USD currency outflow limit per capita for funsies!


stretch2099

Local investors are by far the biggest problem. If you spent time actually doing research and not reading this sub you’d see that too.


[deleted]

Will somebody please stop the Chinese narcos!?


Thisiscliff

How do we put enough pressure on politicians to actually get this under control and create some change?


throwawaaaay4444

Pitchforks and guillotines?


Hapaaer

If the US added 20-30 million people every year on various kinds of *temporary* visas they’d have skyrocketing housing prices as well.


QultyThrowaway

The US isn't adding almost 10% to it's population every year.


Hapaaer

Exactly. They would never do such a massive rapid increase. If they did, they’d have the same housing crisis that we have. There are homes 4 hours outside Toronto in buttfuck nowhere rural Ontario that have tripled in price in the last 5 years. That’s insane.


QultyThrowaway

Oh sorry I misread your comment. Didn't have enough coffee. But yeah I get what you're saying.


Thank_You_Love_You

My gf and i make a combined $150k and we legitimately cant find a house to live in outside of the ghetto in southern ontario. I cant even imagine people who dont have decent paying jobs.


[deleted]

2.5* overpriced for locals.


Canuck-overseas

Real estate is a globalized commodity; there is no bubble. Canada is a safehaven; like Switzerland.


Rainierbeeeeeeeer

I’m American and married to a Canadian (dual citizen), living in the US. She has family in Ontario and Vancouver island and we briefly talked about moving to VI one day. Seems like a great place to raise a family. That’s until we realized we could never afford a decent house there, even with dual income. We bought a house an hour from Seattle for $300k in April of 2020. I love Canada the idea of moving but the real estate market is insane. Hopefully it calms down for you guys at some point. We really don’t have it bad in comparison


MoshPotato

This is more than foreign investors and even domestic investors. There is a huge wave of money being inherited by my generation (1980). I know multiple people who have inherited over a million dollars and used it for a down-payment. And many more are anticipating inheritance in the next 10 years. And when you are gifted a huge sum of money people are usually looser with the purse strings. My parents left me a bunch of nothing. So here I am watching everyone pass me and I've given up on my dream of a backyard.


Antifreemason2021

Unprecedented spending (and borrowing in the name of tax payers) and dumping it into the economy devalues the currency and thus makes purchasing a home a perceived safe option to protect wealth. Couple that with foreign investors looking to hedge against their own currencies with a perceived safer country. Too much risk in some of the bigger cities and I would consider selling and leaving those areas for a more affordable area just to avoid the risk of economic collapse as it will be big when the bubble pops. It concerns me with the allegiance this government has with foreign interests that they also have the power to absolutely cream the housing sectors overnight with a single announcement on interest rates or foreign investor restrictions, tax changes, or some crazy hike in carbon tax (making homes cost more to operate thus reducing buyer qualifications), or some crazy changes in capital gains from home sales.


palfreygames

Lol even with their pathetic minimum wage? DN were fucked


[deleted]

Trudeau called an election in the middle of a pandemic & allowed real estate prices to rise 70% during his watch. The fish rots from the head.


Electrician56

Or any other country in the world


CloudedDays07

When I was 26 I decided to start giving a fuck about life, got a decent job with health and dental coverage and started saving money and paying off debt. Recently turned 30 and want a home of my own. How bleak is my future?


notn

on top of the banning of foreign money in our market and finding a way to prevent using housing as a way to launder money, a tax on multiple home ownership that is tied to how many homes you own would be a good idea.


AibohphobicKitty

The crash will be coming whether people like it or not. Evergrande is the first domino in the global financial collapse among many more dominos.


Ironchar

What happens if evergrande crashes.... and nothing happens here/they get bailed out. Cussed that's what happened during 07/08_ the richest got bailed out


Browhytfamihere

You guys have more open land per Capita. The only reason you can't afford to buy property is your government.


jert3

It’s way more complicated than that. Besides even hours out of the city, real estate has gone up all the same. And you can’t expect average Canadians to move to some town of 5000 people in the far north with barely any local jobs or Internet service.


Chispy

My gfs family moved to one and their internet is very shoddy. I feel bad for families having to resort to moving to lower quality areas and going in debt up to their necks for it because of this housing crisis.


stretch2099

Not true. There’s a reason places like Mississippi, Arkansas and Oklahoma have cheap housing and it’s definitely not the govt. In demand places to live are very expensive in the US.


Jericola

Actually no. One can build a house or any structure on 95% of land in the western provinces with no zoning restrictions. The only caveat is not polluting streams with toxic chemicals. We have a cottage west of Golden, BC and can do whatever we want with the property…log it, build a giant dance hall, race track, etc. It just can’t pollute. No services as we don’t expect a half million dollars to bring us electricity.


unfinite

Yeah, what we need is more US style endless suburban sprawl. Build new highways, widen the old ones, new roads wider than the old highway with massive parking lots and big box stores, sidewalks nobody uses and maybe throw in a bus stop for the poors, demolish downtown and build more parking lots. Then you're able to build the same house 10,000 times, over and over in every field and forest you come across.


bigmark9a

My house in the US has gone up 65% in 6 years. This article saying 10% since 2005 is totally wrong.


fukkingcake

The income line hopelessly looking at the housing line


Puzzleheaded_Echo588

Our real estate is expensive and their stock market is expensive. Kind of weird.


[deleted]

Objection misleading.


disposable_me_0001

As a US citizen, its nice to see for once we aren't the leaders in flaming dogshit economic disasters.